YO, short for Yield Optimizer, recently launched a yoEUR vault to optimize yields on the euro stablecoin EURC. Despite this advancement, the market infrastructure remains inadequate, with limited cross-chain liquidity causing interest rate discrepancies on borrowing and lending markets. The volatility was highlighted when borrowing rates for EURC on Aave v3 briefly surged to nearly 20% before falling below 8%. In theory, borrowers could exploit these rates; however, bridging options are limited as EURC lacks a native burn-and-mint bridge, complicating trades. Moreover, the costs associated with bridging and swaps deter larger liquidity operations. Currently, euro-denominated stablecoins exceed $540 million but face challenges including lack of cross-chain mobility and insufficient scaling in money markets, which may keep interest rates unstable. YO aims to enhance DeFi yield access for euro holders, emphasizing the significance of the euro in global currency markets.

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