MakerDAO Mulls Proposal To Boost DAI Savings Rate

Blend Drives Surge In NFT Lending Activity

 Up to 30% APR on Stablecoins, 6-21% on ETH and BTC

DeFi Alpha is a weekly newsletter published for our premium subscribers every Friday, contributed by Defiant Advisor and DeFi investor at 

. 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 opportunities.

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.

Each week we will provide options to earn yield on ETH, WBTC, stablecoins, and other major tokens.

 -21% APR with wstETH/ETH LP staked in KyberSwap on Optimism 

This yield is accrued in LDO + KNC tokens.

To participate, one must deposit and stake in 

 – 6.22% projected vAPR with Curve tBTC2 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 

 – 8.97% APR with AVAX in Vesper Grow Pools 

This yield is issued in 8.14% AVAX + 1.38% VSP.

To participate, one must deposit into the AVAX pool 

There is a 0.6% fee on withdrawal from Vesper Grow pools and a 15% platform fee on yield generated by the deposited assets.

 – 11.02% APY lending stSOL on Tulip Protocol 

This yield is backed by 5.35% APY paid by borrowers on Tulip + 5.67% APY in staking rewards thanks to Lido.

To participate, one must deposit stSOL in the 

To obtain stSOL, one can trade on a Solana DEX or mint it 

 – 18.43% APY with 50/50 MaticX-WMATIC LP on MeshSwap 

The yield is backed by validator rewards using the MaticX liquid staking derivative + MeshSwap trading fees + MESH rewards + SD rewards.

 – 18.6% APR staking ATOM with Keplr Wallet on Cosmos Hub 

rank by APR, choose a validator, and click 

Then, I specify how many ATOMs and follow the prompts to 

 – 4.7% APY staking 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 

 – 10.88% APY staking with HBARX liquid staking derivative by Stader 

The yield is issued in HBAR rewards, as HBARX is earning validator rewards.

To participate, one must deposit HBAR to receive HBARX 

 – 30.28% APY with sUSD in an auto-compounding vault strategy on Reaper Farm on Optimism 

To participate, one must deposit and stake 

Caution: This farm is in a higher risk protocol that launched on Fantom in summer 2021 and has since suffered a $1.7M exploit in August 2021.

The DeFi Alpha call is held every Monday at 2pm ET in Discord.

check out the recording of this week’s call

Open An Undercollateralized DeFi Credit Line With Union Finance

One of the most talked about trends in DeFi has been undercollateralized borrowing. To date, we’ve mainly seen money flow into protocols like 

 which build infrastructure to cater to larger borrowers. Maple helps creditors manage fast-flowing lending businesses with pooled capital lent to crypto institutional borrowers like market-makers and VCs.

Going further back to 2020, Aave introduced the concept of “credit delegation” where a borrower and delegator (creditor) can agree to an undercollateralized loan but the concept has yet to take off, without a UI to support it on the Aave homepage.

However, in March 2022, a new protocol for building programmable credit lines was quietly launched. 

 is a member-owned credit protocol built on Ethereum and Arbitrum, where members can underwrite lines of credit to other members (aka vouch). As a member, you can borrow from a pool of DAI by simply gaining trust from your friends in Union who vouch for your credit line.

Borrowers are required to pay the interest on their borrowed DAI (currently 10.03% APR) in 30 days or less or else their loan goes into default. What’s even more interesting is that vouchers and borrowers can be contracts and DAOs, so these programmable lines of credit are not just person-to-person.

As borrowers, Union enables us to permissionlessly accumulate a credit line on-chain. The Union protocol is not an underwriter of risk. Instead, it’s a mechanism for coordinating trust into available credit. The mission of the Union Finance community is to enable a virtuous circle of more available credit, lower borrowing costs, and increased lending activity.

While very promising, Union is still a very experimental protocol in DeFi. Check out the on-chain stats for Union 

 including DAI staking, lending, borrowing, defaults, and more on both Ethereum and Arbitrum.

Above, you’ll notice that not all staked DAI is available for borrowing. One has to opt to mint uDAI, making their DAI available for members to borrow, and as of today despite there being about 301k DAI staked on Ethereum and 121k DAI staked on Arbitrum, there’s respectively only 15k uDAI and 31k uDAI in supply, with ~2k uDAI available to be borrowed on Ethereum and all uDAI borrowed on Arbitrum. In Union V2, there will be easier access in-dApp to mint uDAI and hence help to make more uDAI available to borrowers.

Today with Union V2 just around the corner, I’ll show how I recently became a member of the Union Finance DAO and how I’m borrowing 100 DAI, despite having only staked 50 DAI.

Before we get started, please be aware of these risks.

Smart contract risk in Union Finance and Aave

Front-end spoof attack on the union.finance website

Governance attacks or admin key compromise

Pegged assets like DAI can potentially de-peg

What I’ll demonstrate doesn’t have liquidity risk in Union but there is liquidity risk if all DAI were borrowed in Aave

To get started, I need to become a member of the Union Finance DAO either on Ethereum Mainnet or Arbitrum. If I were getting started today, I would join on Ethereum because there’s no uDAI available to borrow from Union on Arbitrum as of this writing.

Staking any amount of DAI to earn UNION. The DAI stake will not be used to borrow. 

For this example, I opted to stake 50 DAI.

You need 1 existing Union member to vouch for you, which will form your starting credit line within Union. I chose to share 

 under #vouch-requests to get members’ attention. 

In my example, mattwerner.eth was kind enough to vouch for me.

Once I’ve earned 1 UNION, I can claim it and pay my membership fee by burning 1 UNION token. 

Tip: when burning 1 UNION, if I click on “Approving with transaction,” I can opt to “Approve with permit” and use a gasless transaction.

 Once I’m a member, you can see my simple dashboard here for tracking Available Credit, Balanced Owed, Vouch, and Minimum Due in however many days.

In my example below, I can borrow DAI against my Available Credit. 

Note that my account is on Arbitrum where there is currently no DAI available to borrow but you hopefully get the point if you’re on Ethereum!

Lastly, I can continue to build my credit by doing any of the following:

Requesting other members I know to vouch for me by sharing my Union profile link

Staking DAI, which is used in “market adapters” to earn yield for the DAO by lending DAI to Aave

Borrowing with my existing credit line and making sure to pay the owed interest every 30 days or less

Anthony Hopkins’ Metaverse Debut Sells Out in Seven Minutes

Bridge to StarkNet and Swap Tokens For Potential Airdrops

StarkNet is a Layer-2 scaling solution for Ethereum that utilizes 

. It was created by StarkWare, an Israeli startup backed by the likes of Sequoia, Paradigm, and Coinbase Ventures, and major users include dYdX, Sorare, and Immutable.

Details around the $STARK token were sketchy until some alpha was leaked during 

, and it’s now time to take mainnet for a test drive.

 – StarkNet is not compatible with Metamask, so you’ll need to install 

Yields: Up to 30% APR on Stablecoins, 6-21% on ETH and BTC



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...

⍺ DeFi Alpha: Open An Undercollateralized DeFi Credit Line With Union Finance