Protocol Architecture

StoneYield uses a modular contract stack to optimize yield while keeping security and operations clear. It issues soul-bound, yield-accruing STUSD and routes returns via Venus.

Foundation Principles

Modular Design: Distinct contracts governing staking mechanics, yield distribution, and strategy execution.
Chain-Enforced Rules: All essential constraints—including transfer limitations and temporal locks—execute on-chain.
Access Control: Critical operations mandate owner or operator privileges (preferably multisignature).
Observable State: Complete protocol and participant states accessible through public view functions.
Yield Maximization: Automated deposit routing to revenue-generating strategies.

Smart Contract System

The infrastructure comprises three primary contracts:

1. StakeableAssetImpl (STUSD Token)

Inherits OpenZeppelin components:

ERC20Upgradeable: Conventional token interface supporting upgrades.
ERC20PermitUpgradeable: EIP-2612 gasless authorization.
Ownable2StepUpgradeable: Protected two-phase ownership migration.
ReentrancyGuardUpgradeable: Reentrancy attack prevention.
PausableUpgradeable: Circuit breaker for emergency scenarios.

2. StrategyRouter

Directs USDC deposits toward yield strategies
Governs strategy weighting and capital allocation
Processes strategy withdrawals
Owner-managed strategy configuration

3. VenuSTUSDVault

ERC-4626 standard vault for Venus Protocol connectivity
Channels USDC into Venus for yield accumulation
Administers vUSDC positions and interest accrual
Delivers standardized router interface

Operational Components

Primary Token Operations

Deposit & Generation: Transforms USDC → STUSD at 1:1 ratio with participant-specified lock duration.
Yield Distribution: Generates supplementary STUSD from accumulated returns.
Position Release: Manual unlock procedure post-expiration.
Accelerated Redemption: Operator-authorized STUSD burn for USDC recovery.
Mobility Constraints: Locked positions prohibit transfers and approvals.

Revenue Generation

Automatic Allocation: Deposits flow directly to Venus Protocol.
Yield Harvesting: Generated returns collected and allocated to participants.
Performance Fee: 7% of Venus yields captured as protocol revenue.
Clear APY: Participants receive 93% of Venus Protocol yields.

Protection Mechanisms

Privilege Hierarchy: Owner and operator roles for function segregation.
Emergency Halt: Pausable operations for critical scenarios.
Rate Limiting: Configurable thresholds on deposits and minting.
Secure Transitions: Two-phase ownership migration process.

Capital Flow Architecture

Participant USDC → StakeableAsset → StrategyRouter → VenuSTUSDVault → Venus Protocol
                                                                            ↓
Participant STUSD ← Yield Allocation ← Protocol (93%) ← Returns Generation

Design Constraints

StoneYield maintains security through exclusions:

Auto-compounding mechanisms within token contracts.
Default mobility for locked positions.
Inflationary yield generation.
Direct oracle dependencies.

sUSDC Wrapper Layer

For liquidity requirements, StoneYield provides sUSDC—a tradeable wrapper encapsulating STUSD:

Enables DEX participation while preserving yield generation
Maintains soul-bound properties for underlying STUSD
Provides market access without compromising security model

Architectural Summary

The protocol architecture deliberately embraces constraints: minimizing complexity reduces vulnerability surface and enhances auditability. Through a consolidated contract structure and rigorous lock/transfer enforcement, StoneYield targets sustained reliability in adversarial environments.