Index Coop’s Money Market Index Wants to Diversify Your Stablecoin Holdings

Diversification can help minimize inherent risks in holding cryptocurrencies

article-image

Muhammed AKAN/Shutterstock modified by Blockworks

share

Index Cooperative, a DAO focused on designing simplified tokens to help buyers create their own crypto portfolio, has recently launched a money market index, icSMMT, to diversify its users’ stablecoin holdings.

The Money Market Index token (icSMMT) is built on Index Protocol, a fork of Set Protocol v2, an Ethereum virtual machine protocol designed to translate asset management strategies into ERC-20 tokens. Its purpose is to help users with large stablecoin holders to diversify their assets, the pseudonymous kindeagle, a product marketing manager at Index Coop, told Blockworks.

“As we saw with the USDC depeg, there is inherent risk in DAO[s], protocols and those in crypto holding a single stablecoin asset,” kindeagle said.

The Money Market Index is an ERC-20 token incorporating six different yield strategies from protocols Notional, Aave, Morpho and Compound for the three most popular stablecoins: USDC, USDT and DAI.

Each position will be representative of specific lending markets through ERC-4646 vaults — a tokenized vault standard that leverages protocol composability instead of secondary market liquidity. 

“Along with diversification, we’re seeking to include stablecoin yield strategies in the Money Market Index that are decentralized, transparent and long-term sustainable,” kindeagle said.

icSMMT is designed so that each stablecoin will be distributed across two protocols with the highest historical lending rates. They note that token holders are expected to earn an annual percentage rate (APR) of 2%-4% in real yield. 

Although there is no set purchase amount for icSMMT, the recommended minimum is around $500,000 due to the high gas prices associated with minting the token. 

Diversification of DeFi strategies 

Index Coop is not the only team that has been looking at ways to diversify DeFi yields. 

Origin Protocol has recently revealed OETH, an ERC-20 token that can help its holders earn rewards almost immediately through its positive rebasing mechanism.

OETH is designed in a way so that staked ether can be spread across various strategies, operators and jurisdictions, similar to icSMMT.  

Underlying collateral used to mint OETH will be paired with ETH and used as liquidity for multiple Curve pools, the company said. 

“With OETH, you can earn additional yield on top of the native staking yield that is available from trusted liquid staking derivatives without wasting hundreds of dollars maintaining your position,” Josh Fraser, co-founder of Origin Protocol, noted in a press release reviewed by Blockworks.


Get the news in your inbox. Explore Blockworks newsletters:

  • Blockworks Daily: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.
  • Empire: Start your morning with the top news and analysis to inform your day in crypto.
  • Forward Guidance: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.
  • 0xResearch: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.
  • Lightspeed: Built for Solana investors, developers and community members. The latest from one of crypto’s hottest networks.
  • The Drop: For crypto collectors and traders, covering apps, games, memes and more.
  • Supply Shock: Tracking Bitcoin’s rise from internet plaything worth less than a penny to global phenomenon disrupting money as we know it.
Tags

Upcoming Events

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research

article-image

Some believe the game is offering investors refunds amidst changes to when GUN tokens can be unlocked

article-image

Ethereum is hoping that increased DA will grow user demand — and its profits through DA fees

article-image

11 years ago, Bitcoin contributors prevented a supply crisis… two centuries from now

article-image

Both samczsun and ZachXBT have issued warnings after the Bybit hack last month

article-image

The investor criticized Michael Saylor’s plan to render his personal bitcoin holdings inaccessible to anyone else forever

article-image

The exchange has structural defenses and protocols to limit manipulations