Yield-bearing tokens (YBT) are derivatives of another token that can generate yield.

For example, mSOL is a YBT because it is created by staking SOL – the "underlying" – and earns Solana's native staking yield. Sandglass splits YBT into its principal and yield components, enabling each to be traded separately. The tokens representing the principal are called principal tokens (PT) and the tokens representing the yield are called yield tokens (YT). Any external rewards other than the native yield that are distributed to the YBT in a vault will accrue to YT holders.