# Tranches With Saffron Finance

# Overview

The Rari Capital DAI pool is integrated within Saffron Finance (opens new window), a protocol pioneering in risk mitigation and steady interest rates across DeFi. Users who deposit into these tranches receive guaranteed rates as well as Saffron Finance's native token SFI (opens new window) emissions as an added incentive for providing liquidity.

Starting December 27th at 6am UTC, users begun providing liquidity to the Saffron/Rari DAI adapter pool (opens new window) as part of Epoch 4 (opens new window).

# What is a Tranche?

Tranches allow users further dynamic exposure based on personal risk appetite and preferences. Saffron Finance has 3 different user-facing tranches:

AA Tranche: LPs adding to this tranche earn less interest but in return are covered in the case of platform risk or loss. This tranche also earns 95% of SFI tokens.

A Tranche: These LPs earn more interest but lose their principal and interest in the case of platform risk.

S Tranche: This tranche is used to balance with the AA and A tranches to maintain equilibirum in reference to the tranche interest rate multiplier.

For reference: Saffron Finance Documentation (opens new window)

What Does This Mean for Rari Capital Users?

Saffron Finance has opened up a DAI tranche specifically designed for Rari’s new DAI pool! Why would they do this? The Rari Capital DAI Pool lends across multiple lending protocols, including Fuse, and is constantly rebalancing and optimizing for the highest yield possible. This is very special for users in DeFi as this is the first known tranche that allows anyone to take advantage of a yield aggregator like Rari Capital performing as the underlying interest-generating machine within the trance.

As part of this partnership, Saffron Finance has integrated the Rari DAI Pool into their tranche offerings and at Rari Capital we designed and built our own interface to easily interact with the latest tranche.

Whether you use the Saffron Finance website or the Rari Capital portal, you will easily be able to deposit/withdraw/track all of your positions!

Note: Saffron Finance follows an Epoch schedule, meaning every two weeks you must withdraw and re-deposit (if you wish to stay), in order to maintain your interest earning potential

# Liquidity Incentives

The DAI/Rari pool is incentivized with a new amount of SFI every two weeks! This means that all deposits into this trance will be rewarded with SFI distributions throughout each epoch.

# How to Deposit Into Saffron/Rari DAI Tranche

If you would like an interactive version of this step-by-step process, the Saffron Finance team published a Tranche YouTube Tutorial (opens new window) to help guide you even more.

Step 1: Connect a Wallet

The Rari Capital Protocol currently supports MetaMask (opens new window), WalletConnect (opens new window), Portis (opens new window), Torus (opens new window), Formtatic (opens new window), and Authereum (opens new window). If you do not have a wallet, we recommend you refer to this guide (opens new window)for MetaMask. Users can connect their wallets by selecting the "Connect Wallet" button on the Rari Capital Portal Tranches (opens new window).

Step 2: Choose a DAI Tranche That Fits Your Desired Risk Profile

  • S Tranche

    • Liquidity added to other tranches as needed.
    • SFI Earnings: 90%
  • AA Tranche (Not active yet)

    • Reduced interest earned. Covered in case of failure by A tranche.
    • SFI Earnings: 0%
  • A Tranche

    • 10x interest earned. Cover provided to AA tranche in case of failure.
    • SFI Earnings: 10%

Step 4: Track Your Interest and SFI Rewards Accrued

After depositing, your returns and rewards can be viewed within the Tranches Dashboard (opens new window).

# How to Withdraw

Step 1: Choose The DAI Tranche That Holds Your Deposit

  • S Tranche

  • AA Tranche (Not active yet)

  • A Tranche

Step 2: Withdraw Into a Supported Asset

After choosing the tranche you deposited into and selecting the transaction button, users can then toggle the withdrawal function with the gear button in the top right. Then, withdraw DAI from the pool. You will no longer be a user of the DAI tranche and your DAI can now be found in your Ethereum wallet.


If you noticed anything throughout your experience that was not described in this tutorial, we encourage you to reach out in our Discord for assistance and a community member will always be wiling to help. Saffron Finance is in our Discord server as well.

# About Saffron Finance

Launched in October 2020, the development team at Saffron Finance have come together to deliver a brilliant innovation in the decentralized finance sector. This decentralized protocol optimizes yield for users contributing liquidity with various predetermined tranches set at different risk levels. These tranches are set to two week epochs, where those contributing liquidity across the provided pairs receive payouts in exchange for locking their funds up for two weeks. Saffron successfully mitigates significant effects of impermanent loss by categorizing risk and return while allowing its users to choose their risk level.