⍺ DeFi Alpha: How To Refuel Your Wallet If You Get Stranded On A New Chain
Yields: Up to 57% APR on Stablecoins, 7-22% on ETH and BTC Starter Tutorial: Refuel Your Wallet to Pay Gas with Bungee by Socket Degen Tutorial: Earn 16% APR On USDC in the dYdX Liquidity Pool DeFi Alpha is a weekly newsletter published for our premium ...
- Yields: Up to 57% APR on Stablecoins, 7-22% on ETH and BTC
- Starter Tutorial: Refuel Your Wallet to Pay Gas with Bungee by Socket
- Degen Tutorial: Earn 16% APR On USDC in the dYdX Liquidity Pool
DeFi Alpha is a weekly newsletter published for our premium subscribers 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! Before the current bear market took hold, DeFi liquidity had 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 Cosmos and Solana. Any given day, a new DeFi or NFT project is launched.
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.
Any information covered in DeFi Alpha should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions. Any mention of a token or protocol should not be considered a recommendation or endorsement.
🙌 Together with:
- Oasis.app allows you to borrow Dai against your favorite crypto assets, Multiply your exposure and Earn, all in the most trusted way.
📈 Yield Alpha
Each week we will provide options to earn yield on ETH, WBTC, stablecoins, and other major tokens.
- ETH - 22.92% APR with the wETH/sETH LP staked in Velodrome on Optimism
- This yield is accrued in trading fees and VELO.
- To participate, one must deposit and stake in this wETH + sETH LP.
- WBTC - 6.27% projected vAPR with the Curve tBTC LP staked in Convex
- This yield is accrued in CRV, CVX, and trading fees.
- To participate, one must first deposit tBTC, renBTC, sBTC and/or WBTC into this Curve tBTC pool and then stake the LP here in Convex.
- Stablecoins - 57.88% projected vAPR with the Curve alusdfraxbp LP staked in Convex
- This yield is accrued in CRV, CVX, and trading fees.
- To participate, one must first deposit alUSD, FRAX, and/or USDC into this Curve alusdfraxbp LP and then stake the LP here in Convex.
- AVAX - 13.5% APR lending AVAX to the sAVAX/AVAX pool on Platypus via Vector
- This yield is issued in VTX, PTP, QI, and AVAX.
- To participate, one must deposit into the AVAX Stake option here on Vector.
- SOL - 10.24% APY lending stSOL on Tulip Protocol + 5.2% APR from the underlying SOL liquid staking rewards issued to stSOL holders
- This yield is backed by interest paid by borrowers on Tulip + staking rewards.
- To participate, one must deposit stSOL in the Tulip lending tab.
- To obtain stSOL, one can trade on a Solana DEX or mint it here on Lido.
- MATIC - Net 21% APY with LP MaticX-MATIC on Balancer
- The yield is backed by validator rewards using the MaticX liquid staking derivative + trading fees on Balancer + BAL rewards + SD rewards.
- To participate on Polygon, one can use the Stader MaticX dApp to mint MaticX.
- Then, I deposit into the 50/50 MaticX-MATIC pool on Balancer and stake the LP.
- ATOM - 13.5% APR staking pATOMs on pSTAKE on Ethereum
- The yield earned is issued and claimable in pATOM.
- To participate, one must first mint a 1:1 representation of ATOM as pATOM on Ethereum by using the pSTAKE dApp under Stake
- Then, deposit/stake pATOMs to get stkATOMs and earn 13.5% APR
- FTM - 13% APY staking with sFTMx liquid staking derivative by Stader
- The yield is issued in FTM rewards, as sFTMX is earning FTM via validator rewards to support Fantom’s PoS network.
- To participate, one must deposit FTM to receive sFTMX here on Stader.
- HBAR - 36.9% APY staking with HBARX liquid staking derivative by Stader
- 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 may 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.
Layer-2 rollup Arbitrum kicked off a two-month-long program on June 21.
Participants will be able to claim NFTs based on completing various tasks over the summer.
Week 1 was Bridge Week and we walked you through it in a previous issue of DeFi Alpha.
Participants can now claim their Week 1 NFTs.
Week 2 involved the GMX derivatives protocol but was paused after heavy traffic on Arbitrum caused gas fees to spike.
Arbitrum @arbitrum📳🧑🚀 𝘈𝘙𝘉𝘐𝘕𝘈𝘜𝘛𝘚, 𝘍𝘈𝘓𝘓 𝘐𝘕 ! The first week or so of the Arbitrum Odyssey has been very exciting to say the least! But we’ve decided to pause the Arbitrum Odyssey as of now, to be resumed after Nitro is released. ⏸️ More info below. 👇2:52 PM ∙ Jun 29, 20222,098Likes685Retweets
We’ll be watching for the Odyssey to resume.
$HOP went live on June 9. Claim here.
If you followed the guide posted in previous issues of DeFi Alpha, you should be eligible.
Congratulations if you followed our guide betting on a hunch that Optimism would release a token!
$OP is Live! Claim guide here.
- Arch Finance - a protocol for comprehensive indices that provide access to differentiated sources of market risk.
- Concentrator - Congrats if you used Concentrator! They’re currently running an Initial Farming Offering (IFO) and are expected to distribute CTR tokens to early users of Concentrator.
- DeFi Saver - a one-stop dashboard for creating, managing and tracking DeFi positions across Aave, Compound, Maker, Liquity, and Reflexer
- 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
- Jupiter - The leading DEX aggregator by trading volume on Solana
- LI.FI - A cross-chain bridge and DEX aggregator protocol
- Liquality - A cross-chain, non-custodial browser extension wallet, similar to MetaMask but with more integrations for swapping cross-chain.
- Magic Eden - The leading NFT marketplace by trading volume on Solana
- Nested - a crypto social trading platform built on Ethereum and other chains
- 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
- Sense Protocol - A decentralized fixed-income protocol on Ethereum, allowing users to manage risk through fixed rates and future yield trading on existing yield bearing-assets
- 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
- 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
- ZigZag - a DEX on zkSync that’s announced an upcoming airdrop.
- zkSync is a Layer 2 scaling solution for Ethereum that uses zero-knowledge proofs to enable scalable low-cost payments. Bridge some assets and do some swaps for a potential airdrop. Guide here.
👨🎓 Defiant Starter Tutorial
How to Refuel Your Wallet to Pay Gas with Bungee by Socket
As early DeFi adopters, we’ve all lived through this frustrating experience:
First, read about a new dApp on an L2 or L1…
Then, rush to bridge stablecoins to this new chain…
Finally, tokens arrive, but oh no, we forgot about gas to pay transaction fees!
What’s even more common is needing just a small amount of ETH on Arbitrum/Optimism, xDAI on Gnosis, or MATIC on Polygon to complete one final transaction.
For me, ETH is precious and the last thing I want to do is bridge too much of it, only to see it sitting unused and unproductive in my wallet, where it might not get used.
Although Bungee (previously FundMovr) is best known for helping users discover the best bridges to move your assets between chains via the best possible route, they created another helpful tool called Refuel to bridge and swap cross-chain, small quantities of native tokens used for gas.
Today, I’ll briefly show you how I can save myself from being left stranded on-chain, without gas to pay transaction fees, using Refuel. I have most often relied on Bungee Refuel to send 0.005-0.02 ETH from Ethereum Mainnet to new L1s and L2s, but I’ll show how much better it is to consider “refueling” using tokens originating from a wallet already on an L2.
Before we get started, please be aware of these risks.
- Smart contract risk in Socket, the protocol powering Bungee, as well as any bridge protocol such as Hop used by Bungee
- Front-end spoof attack on the website bungee.exchange
- Systemic risk in DeFi composability
- Pegged assets such as stablecoins can potentially depeg
Step 1: First, depending on which of the chains supported below I am urgently needing to receive tokens to pay gas (aka transaction fees), I might consider wherever I already have tokens. Let’s assume I have some ETH on Arbitrum so I’ll send just 0.005 ETH via Refuel to my wallet on Optimism.
Step 2: I specify sending 0.005 ETH from Arbitrum to Optimism. The only fee is the Optimism network fee, 0.000171 ETH so I’ll end up with ~0.00483 ETH.
At ETH/USD = $1700, that’s paying about $0.29 to bridge $8.50!
Step 3: Click Move and confirm the transaction in my wallet.
🦍 Defiant Degen Tutorial
Earn 16% APR On USDC in the dYdX Liquidity Pool
dYdX is a decentralized derivatives protocol that lets users make leveraged bets on BTC, ETH and various other crypto assets.
Originally launched on Ethereum in April 2019, dYdX surged in popularity after launching its native DYDX token in September 2021. It was one of the most lucrative airdrops we’ve seen yet, though US users missed out.
The platform continues to attract new users despite the bear market, according to the project’s Dune dashboard, and it’s ranked #2 among DEXs on CoinMarketCap.
dYdX recently revealed plans to deploy its own blockchain in the Cosmos ecosystem for its V4 iteration, possibly in a bid to add value to the DYDX token, which has trended lower ever since it launched.
The token has nearly doubled since the news broke on June 22.
If one is bullish on DYDX, staking USDC in the protocol’s Liquidity Pool is an easy way to acquire some tokens. 25M DYDX tokens are allocated as rewards for the pool, which is currently yielding 16% APR.
Risks of Staking
- The USDC is lent out to professional market makers (Wintermute, Amber Group, Kronos, Sixtant, DAT Trading ) on an uncollateralized basis, who use it to offer deeper liquidity on the protocol. Though they cannot use the borrowed funds outside dYdX, there’s always a risk that borrowers may not repay their loans. A portion of your staked USDC may be lost in such a scenario.
- Smart contract risk. Please review the documentation before depositing assets.
To withdraw your USDC, you’ll need to request a withdrawal at least 14 days before the end of an epoch. dYdX epochs start every 28 days.
Let’s get started.
Step 1: Head over to the dYdX Liquidity Pool.
Connect your wallet and click the ‘Stake’ button.
Accept the T&Cs (non-US users only).
Step 2: Enter the amount of USDC you wish to stake and approve your tokens by clicking ‘Enable USDC’.
Once the approval transaction is confirmed, click ‘Stake funds’ to stake your USDC.
That’s it! You’re now earning DYDX tokens which you can claim at any time.
📰 Elsewhere on The Defiant
Tuesday Tutorial on The Defiant YouTube: This week, Robin covered the new Zapper V2 Web3 explorer, which aims to provide more reliable information on DeFi, DAOs, and NFTs. 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.