⍺ DeFi Alpha: 40% APR on Stablecoins with Rose on Aurora
DeFi Alpha is a weekly newsletter published every Friday, contributed by Defiant Advisor and DeFi investor at 4RC, DeFi Dad, and our Degen in Chief yyctrader. It aims to educate traders, investors, and newcomers about investment opportunities in decentrali...
DeFi Alpha is a weekly newsletter published every Friday, contributed by Defiant Advisor and DeFi investor at 4RC, DeFi Dad, and our Degen in Chief yyctrader. It aims to educate traders, investors, and newcomers about investment opportunities in decentralized finance, as well as provide primers and guides about its emerging platforms.
Two years ago, DeFi investors could easily name every yield farming opportunity without much effort. It was a simpler time, when only a handful of teams had launched with any liquidity to trade, lend, borrow, provide liquidity, or even demonstrate new primitives such as no-loss savings by PoolTogether.
But times have changed! DeFi liquidity has grown to hundreds of billions of dollars across Ethereum with new burgeoning DeFi economies taking shape on EVM-compatible chains such as Polygon and Avalanche and non-EVM chains such as Terra and Solana. Any given day, a new DeFi or NFT project is launching. So after writing and creating countless DeFi guides and tutorials since 2019, we at The Defiant agreed it’s time we publish a more detailed weekly guide on all you need to know to keep up with new and old yield earning opportunities.
This is DeFi Alpha by The Defiant.
We are sending this issue to all Defiant subscribers. If you want to keep receiving this newsletter going forward please subscribe here:
🙌 Together with:
- Sperax USD, the FIRST Auto-yield stablecoin on Layer 2, connects you with modern money. Learn more!
- Taraxa is a public ledger platform purpose-built for audit logging of informal transactions with upcoming applications in social Web3. Run a Taraxa node to earn top-block producer rewards, or stake with 20% APY!
📈 Yield Alpha
Each week we will provide options to earn yield on ETH, WBTC, stablecoins, and other major tokens.
- ETH - Earn 9.01% APR with Instadapp Lite’s ETH vault for leveraging stETH ~3X
- This yield is accrued by borrowing ETH against stETH collateral in Aave, then converting ETH to stETH to gain an increased amount of ETH POS staking rewards.
- To participate, go to the Instadapp Lite dApp (ETH) to deposit ETH or stETH.
- BTC - lend WBTC on Starlay money market on Astar Network for 20% APY
- This yield is issued in WBTC interest paid by borrowers + LAY rewards.
- To participate, deposit into the WBTC pool.
- Stablecoins - Earn up to 40% APR with RUSD on Rose on Aurora (Near)
- This yield is issued in trading fees + stablecoins + ROSE rewards.
- To participate, one must stake the RoseRUSDLP here which is covered in the Defiant Beginner Tutorial below.
- Stablecoins - Earn up to 32% APR with YUSD on Yeti (Avalanche)
- This yield is issued in YETI tokens.
- A step-by-step guide is provided in this week’s Degen Tutorial
- AVAX - Stake sAVAX/AVAX LP from Trader Joe on Yield Yak at 9.5% APY
- This yield is issued in trading fees while JOE rewards are auto-compounded into the LP.
- To participate, check out this page on YieldYak.
- SOL - Lend SOL with Francium farmers on Solana to earn 15.39% APY
- This yield is backed by interest paid by borrowers on Francium.
- To participate, check out the Lending tab on Francium under SOL.
- LUNA - LP with LUNA-LunaX by Stader in TerraSwap to earn a net ~25.1% APY
- This yield is backed by auto-compounding LUNA staking rewards thanks to LunaX by Stader earning 7.45% APY, trading fees on TerraSwap, and 21.3% APY in SD token rewards.
- To participate on Terra, deposit 50% of LUNA into LunaX and then go here to TerraSwap to pair 50/50 LUNA<>LunaX as an LP and passively collect trading fees, staking rewards, and claimable SD tokens, without impermanent loss.
- MATIC - stake MATIC with Lido stMATIC at 10.37% APR
- The yield is backed by validator rewards using a MATIC liquid staking derivative.
- To participate on Polygon, https://app.claystack.com/stake/polygon on Claystack.
- ATOM - mint pATOM and stake the pATOMs on Ethereum to earn more pATOMs on pSTAKE at a rate of 12.02% APR
- The yield earned is issued and claimable in pATOM and this yield is expected to hold steady for weeks/months unless pSTAKE changes their liquid staking model.
- To participate, one must first mint a 1:1 representation of ATOM as pATOM on Ethereum by using the pSTAKE dApp under Deposit
- Then, deposit/stake pATOMs to get stkATOMs and earn 12.02% APR
- FTM - stake with the first FTM liquid staking derivative by Stader, earning 13.5% APY
- The yield is issued in FTM rewards, as sFTMX is earning FTM via validator rewards to support Fantom’s PoS network.
- To participate, deposit FTM to receive sFTMX here on Stader.
- Caution: This is in beta with a recommended limit of 1000 FTM / staker.
- HBAR - stake with the first HBAR liquid staking derivative by Stader, earning 54.8% APY
- The yield is issued in HBAR rewards, as HBARX is earning validator rewards.
- To participate, deposit HBAR to receive HBARX here on Stader.
- Caution: This is in beta and withdrawals will not be possible until July 2022 or later.
🪂 Airdrop Alpha
In each DeFi Alpha guide, we update a list of the most obvious DeFi protocols that have yet to announce and/or launch a token.
- Arch Finance - a protocol for comprehensive indices that provide access to differentiated sources of market risk.
- Arbitrum - one of the leading L2 solutions for Ethereum with live dApps such as Uniswap, SushiSwap, Hop, and more. A token may be imminent, according to this tweet.
- Concentrator - an app for boosting Curve LP yields by harvesting and auto-compounding rewards earned via Convex
- DeFi Saver - a one-stop dashboard for creating, managing and tracking DeFi positions across Aave, Compound, Maker, Liquity, and Reflexer
- Element Finance - Congrats if you tried Element! They just announced ELFI tokens to claim here.
- Edge Protocol - the first money market on Terra, looks like Aave or Compound
- Euler Finance - a non-custodial protocol on Ethereum that allows users to lend and borrow almost any crypto asset, just launched but has yet to launch a token.
- Francium - leveraged yield farming similar to Alpha Homora but on Solana, one can choose to simply lend single assets or hold leveraged LPs to potentially earn an airdrop here
- Hop Protocol - become an LP to enable bridging instantly between Ethereum Mainnet, Polygon, Arbitrum, or Optimsm without waiting for long delays in withdrawals; DeFi Dad has a full blown video tutorial on how to become a Hop LP and potentially earn a future HOP airdrop.
- Katana DEX - Farm/stake the AXS/WETH LP or SLP/WETH LP on this forked AMM on Ronin to earn WRON (wrapped RON), so this is a guaranteed reward but for a token not yet trading
- Jupiter - The leading DEX aggregator by trading volume on Solana
- Magic Eden - The leading NFT marketplace by trading volume on Solana
- Optimism - one of the leading L2 solutions for Ethereum with live dApps such as Uniswap, Hop, Synthetix and more, we expect a token to eventually launch so by depositing assets or transacting, one might earn a future airdrop
- Opyn - one of the OG decentralized options protocols on Ethereum, with major investors that signal a token has to be in their future. Buy/sell puts or call options to earn a possible future airdrop.
- Polymarket - one of the strongest players in the DeFi prediction market vertical, bet on an outcome related to crypto, politics, sports and more or add liquidity
- Polynomial - A newer DeFi derivatives vault creator, built on Optimism
- Set Protocol - one of the earliest DeFi protocols yet to launch a token for DeFi asset management, popular for TokenSets and known for powering IndexCoop indexes
- Socket (formerly Movr) - their bridge aggregator Bungee moves assets between chains, finding the cheapest, fastest route
- Terraswap - One of the most popular AMMs on Terra
- Volmex - Volmex is a tokenized volatility protocol, similar to the VIX but ETHV
- Wormhole - a cross-chain messaging protocol known for bridging between Solana, Terra, Polygon, BSC, Avalanche, Fantom, and Oasis
- Yield Protocol - a newer protocol for fixed-term, fixed-rate lending in DeFi, backed by Paradigm, one might earn a future airdrop by lending DAI or USDC
- Zapper - participate in Zapper trading, lending, providing liquidity, or yield farming; given the Zapper Quests and NFT Rewards program, it can be surmised that if Zapper ever releases a token, this is one way they might do a retro airdrop
- Zerion - same can be said speculated about Zerion; if they ever release a token, they’re likely to reward those who interacted with their smart contracts swapping, lending, providing liquidity, or borrowing.
🧑💻 Defiant Starter Tutorial
How to Earn 40% APR with Stablecoins in Rose.Fi on Aurora
Rose is a new “liquidity layer” protocol for Aurora, which is an EVM-compatible network built on Near. The frontend application for Rose looks like a combo of an AMM like Uniswap crossed with a lending / borrowing market like Aave. With Rose, Aurora DeFi users can do a number of key investing activities:
- Earn as an LP
- Farm with LP tokens
- Borrow and mint RUSD stablecoins
Recently on April 7th, Rose launched their first overcollateralized stablecoin RUSD. RUSD is borrowed against your own cryptoassets, which helps to ensure the peg against the US dollar is defended. What’s interesting and coming soon is Rose will allow for borrowing against your interest-bearing tokens, such as LP tokens, money market lending tokens (ie aTokens), and other assets, like NFTs, and liquid staking tokens such as stNEAR or stETH.
Caution: Please be aware Rose is still a newer application on Aurora and we know little about the founders other than the Twitter account here for “Aiden.” New DeFi applications can have unknown bugs and vulnerabilities or even worse, code that can be intentionally misused by team members to steal deposited tokens. Exercise extreme caution sizing a position.
Step 1: First, I will need to go to the Rainbow Bridge to bridge ETH from Ethereum to Aurora. I will pay transaction fees in aETH on Aurora but it’s much less costly than on Ethereum.
Step 2: Next, I will go to the Rose.fi app under Farmsto double-check the estimated yields before bridging more stablecoins over to Aurora. Let’s assume I choose to farm with the stablecoin farm below.
Step 3: Then, I will need to deposit DAI, USDC, and/or USDT into the Stables Pool to get the RoseStablesLP. This will give me what I need to deposit as an LP into the RUSD Pool which is made up of the RoseStablesLP + RUSD. I will follow the prompts to Approve + Deposit (2 transactions).
Step 4: Now, I will deposit the RoseStablesLP into the RUSD pool here.
Step 5: Lastly, I can deposit/stake the RoseRUSDLP tokens here, and follow the prompts to Approve + Deposit.
That’s it! I’m earning 39-40% APR yield with only stablecoin exposure on Rose on Aurora.
Earn over 80% APR on your stables with USDB.
USDB is a decentralized algorithmic stablecoin that bridges the world of DeFi and TradFI.
USDB operates through an innovative proof of burn mechanism backed by protocol owned liquidity.
How to get involved in 2 simple steps:
Step 1: Mint USDB on usdbalance.com or simply swap your token of choice to it on Beethovenx (beets.fi).
Step 2: Invest your USDB in the A Dai-Abolical Balance pool and earn your juicy APR’s.
🦍 Defiant Degen Tutorial
32% APR on Stablecoins With Yeti Finance On Avalanche
Yeti Finance is a borrowing protocol on Avalanche that allows users to borrow interest-free against base assets like WETH, staked assets like Liquid AVAX, LP tokens and yield-bearing stablecoins.
YUSD is Yeti’s overcollateralized dollar-pegged stablecoin. The stabilization mechanism is similar to that of Liquity.
Launched a week ago, the majority of YETI token emissions are being directed at the YUSD Curve pool in order to bootstrap deep liquidity for the stablecoin. The pool currently has $446M worth of assets.
Today, we’re looking at the YUSD LP farm that is currently yielding 32% APR in YETI tokens.
Step 1: Add the Avalanche network to MetaMask using Chainlist.
Step 2: Bridge your assets. We’re going to use the official Avalanche Bridge since it provides an initial AVAX airdrop for gas fees, but there are many other options - Anyswap, Celer, Synapse etc.
Gas fees on Avalanche are paid in AVAX and you’ll receive 0.1 AVAX when you bridge assets for the first time. I recommend buying some additional AVAX so that you don’t run out of gas at an inopportune moment. You can do so on Trader Joe, which is the major DEX on Avalanche.
Step 3: Add liquidity to the YUSD Curve pool. You can deposit USDC or USDT. Note that YUSD is currently trading at a premium due to demand, so you can expect to pay around 0.2% in slippage.
You’ll be asked to approve spending your assets. Confirm the transactions to receive your Liquidity Provider (LP) tokens.
Step 4: Stake your Curve LP tokens in Yeti Finance.
That’s it! You’re now earning YETI rewards that you can claim at your convenience.
YETI tokens can be staked for veYETI and boosted rewards. Full tokenomics can be found here.
Note that you will not earn any token rewards if you miss this step.
📰 Elsewhere on The Defiant
Tuesday Tutorial on The Defiant YouTube: This week, Robin went back to basics with a full guide to getting started with crypto in 2022. Learn how and subscribe to The Defiant on YouTube!
The information contained in this newsletter is not intended as, and shall not be understood or construed as, financial advice. The authors are not financial advisors and the information contained here is not a substitute for financial advice from a professional who is aware of the facts and circumstances of your individual situation. We have done our best to ensure that the information provided is accurate but neither The Defiant nor any of its contributors shall be held liable or responsible for any errors or omissions or for any damage readers may suffer as a result of failing to seek financial advice from a professional.