Crypto Lending Yields Fall Short as US Treasuries Offer Higher Returns

The recent Federal Reserve decision to raise its target range by 25 basis points has had a significant impact on the world of cryptocurrency lending. The one-year Treasury yield, which now stands at 4.45%, has set a new benchmark for crypto lending yields.

A study by Coin Metrics found that Aave lenders earned an average of 31 basis points less than the one-year Treasury yield throughout 2026. In fact, Aave's $USDC yield trailed the Treasury rate in 78% of the intervals measured.

Anthony DeMartino, co-founder and CEO of Sentora, argues that correlation between SOFR (Secured Overnight Dollar Funding Rate) and CDOR (Compound Daily Overnight Rate) has been very low. This means that a Fed hike should not be expected to pull on-chain rates materially higher. Instead, CDOR measures what borrowing dollars inside Aave costs on any given day.

The study also found that Morpho's median $USDC vault beat the one-year Treasury benchmark by 65 basis points but carried roughly 3.3 times the annualized volatility of the Aave figure.