The yield engine
Most DeFi yield is circular. It comes from crypto lending or token rewards, so it rises and falls with the crypto market. Trade Dollar's yield comes from somewhere else: the financing of real, physical trade.
Financing commodities, not borrowers. The vault funds the movement of physical goods, like metals, minerals, and industrial materials, across borders. It does this by financing the goods themselves, not by lending money to a company and hoping it repays. The core rule is simple: the vault only deploys capital where it can take and enforce legal rights over the underlying goods. The full treatment of this model, including what happens in a default, is on The non-credit model: default and recovery.
How a single deal works. A supplier gathers a batch of commodities ready for export and places it in approved storage. The vault advances cash against that inventory, sized below the verified acquisition price of the goods. The gap between the advance and that price is the haircut, and a lower loan-to-value leaves a larger buffer. Every deal is financed against a pre-contracted onward sale: the end buyer is committed before the financing is advanced. When the buyer pays, the proceeds land in a controlled settlement account, the financing is repaid with the financing fee, and the capital recycles into the next deal.
A worked example
The numbers below are illustrative only. They show the shape of a deal, not actual terms or returns.
The vault advances between 60% and 90% of the verified domestic acquisition price of the goods, depending on the commodity, the route, and the counterparty. The gap between the advance and the value is the buffer that absorbs price moves before LP capital is exposed. The lower the advance, the larger the buffer. The current sizing target is that the financed amount holds against a price fall of about 45% over the deal's tenor; this is a design parameter, not a guarantee.
Take a parcel with a verified acquisition price of $1,000,000. At an 80% advance the vault deploys $800,000, leaving a 20% buffer; at a 60% advance it deploys $600,000, leaving a 40% buffer. The parcel is financed against a pre-contracted onward sale to an end buyer, documented before the advance, on terms that include the financing fee, say 2% of the advanced amount.
After 60 days, the buyer pays for the goods into a controlled settlement account. The financing is repaid first, principal plus the financing fee, then the capital goes into the next deal. Across the whole portfolio, the blended return is lower than any single deal's fee, because some capital always sits in the liquid buffer and deals settle on different dates. A 2% fee earned over about 60 days, repeated as capital recycles through roughly six cycles a year, is a gross spread on deployed capital in the region of 12% to 15% a year. The financing fee the vault earns is net of deal-level costs, including the originator's own economics on the trade. The net yield to LPs is what remains after the performance fee and the drag from capital that sits in the liquid buffer between deals. That is how the targeted 8% to 12% net range is reached.
A live deal today
The numbers above are illustrative. Here is a live program on the Salus trade-finance platform, with all counterparties anonymized. A mineral exporter in Rwanda is financed against parcels of tin concentrate. Each parcel is secured by a digital warehouse receipt and cargo insurance, with the financing vehicle as the named loss payee, and the financing is repaid when the trade settles. Parcels in this program run from about $50,000 to $250,000 each, on short tenors of 30 to 90 days, typically around 45. Salus has financed 72 such parcels to date with zero defaults.
The live book today is concentrated in Rwandan metals, tin, tantalum, and niobium, with more producers and corridors being onboarded across Africa, and a near-term receivables line in agricultural exports such as avocados into Europe. Concentration is therefore higher at launch than in the diversified end state. See Risks for the launch concentration note.
These are deals originated and run by Salus, the trade-finance platform. Trade Dollar, the protocol, brings this proven method on-chain. The protocol itself is pre-launch and is building its own on-chain record.
Targeted, not guaranteed. Trade Dollar targets a net yield of 8% to 12% per year for LPs. This is a target, not a promise. The actual yield varies with deal flow, how much of the capital is deployed at any time, and when trades settle.
Why it does not track crypto. The return is driven by the financing fee on physical trade, not by crypto borrowing demand or central bank rates. That makes it largely uncorrelated with both crypto markets and traditional fixed income.