A fast-growing decentralised finance protocol has generated unusually high returns during recent cryptocurrency market turbulence, underlining how volatility is reshaping the economics of digital asset income strategies.

Yield Basis, a structured crypto liquidity protocol focused on bitcoin markets, has delivered annualised returns of about 26 per cent since launching its latest pools in November, with yields briefly reaching 70 per cent during a 19-day period of heightened volatility earlier this year, according to new research from Valueverse.

The protocol, which enables investors to earn yield on wrapped bitcoin holdings through leveraged liquidity provision, has also proven profitable in aggregate, generating $12.15mn in fees since…