Spectra, a decentralized yield trading and farming protocol, has experienced a significant resurgence, with its total value locked (TVL) increasing by over 600% in December, reaching a record $143 million as reported by DefiLlama. After a period of dormancy following its project retirement in Q1 2023, Spectra launched its v2 protocol in June 2024, focusing on multi-chain, EVM-compatible interest rate derivatives.

Spectra allows users to separate and tokenize yield from principal assets, enabling trading and other DeFi activities. Its protocol utilizes Yield Tokens (YT) and Principal Tokens (PT), minted on ERC-4626 interest-bearing tokens, offering users the ability to lock in specific interest rates. Currently, USR, a decentralized USD-pegged stablecoin, holds the largest share of deposits on Spectra.