Yields: Up to 24% APY on Stablecoins, 6-82% 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 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.
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:
DeFi Saver is the most comprehensive dashboard for Liquity protocol with unique automated liquidation protection features. Now, with full support for the newly launched Chicken Bonds bonding protocol as well.
📈 Yield Alpha
Each week we will provide options to earn yield on ETH, WBTC, stablecoins, and other major tokens.
ETH – 82% APY with pETH/ETH Curve LP staked in Convex via Concentrator
This yield is accrued in aCRV + trading fees compounded in the LP.
To participate, one must Deposit into the pETH/ETH Curve LP here (not stake).
Then, one must stake/deposit the Curve LP under the ETH-pETH vault under aCRV Vaults on Concentrator.
BTC – 6.36% projected vAPR with the Curve tBTC+sbtcCrv 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 factory pool and then stake the LP here in Convex.
AVAX – 8.89% 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 here in Vesper
There is a 0.6% fee on withdrawal from Vesper Grow pools and a 15% platform fee on yield generated by the deposited assets.
SOL – 10.14% APY lending stSOL on Tulip Protocol
This yield is backed by 5.09% APY paid by borrowers on Tulip + 5.5% APY in staking rewards thanks to Lido.
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 – 22.17% 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.
To participate on Polygon, I use the Stader MaticX dApp to mint MaticX.
Then, I deposit into the MaticX-WMATIC pool on MeshSwap and stake the LP.
ATOM – 19.85% APR staking ATOM with Keplr Wallet on Cosmos Hub
The yield earned is issued in ATOM.
To participate, one must set up a Keplr Wallet, go to the Cosmos Hub validators on Keplr Dashboard, rank by APR, choose a validator, and click Delegate.
Then, I specify how many ATOMs and follow the prompts to Delegate.
FTM – 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 here on Stader.
HBAR – 10.36% 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 here on Stader.
Stablecoins (USD) – 24.29% APY with USDC in the allape Notional Spool
Be aware 16.7% APY of the yield consists of SPOOL rewards.
To participate, one must deposit into the allape Notional spool here.
📱DeFi Alpha Call
The DeFi Alpha call is held every Monday at 2pm ET in Discord.
In case you missed it, check out the recording of this week’s call.
Unlocking the power of your DeFi portfolio
We all know that managing a DeFi portfolio can be a significant challenge.
Especially during times of market turbulence, keeping your portfolio efficiently balanced can turn into a full-time job. Crypto is a 24/7 market that requires 24/7 monitoring of positions in order to be a competitive investor in the market.
Until now, the tooling needed to monitor your portfolio and ensure that your positions are allocated efficiently has been kept private. Mainly being used by institutional investors who can sit back and relax while their portfolios are maintained for them.
Mero is bringing professional DeFi tooling and automated liquidity management to every DeFi user. Through Mero, users can easily automate their liquidity to react to market conditions and ensure that it is always allocated where it should be.
The Defiant readers have the opportunity to become an early LP on Mero before its suite of portfolio automation products is released. Start earning yield using this link.
Art Gobblers’ Floor Price Drops 50% After Splashy Debut
Arweave, Polygon Rally After Meta’s NFT Announcement
KPRVerse Spikes Gas Above 5,000
🔗Read the full article at thedefiant.io🔗
👨🎓 Starter Tutorial
Lend USDT for 12.4% APY to Undercollateralized Borrowers on TrueFi
Originally built by the Archblock team, (formerly TrustToken) who pioneered the stablecoin TUSD and other top fiat-backed stablecoins, TrueFi is a DeFi credit protocol for lending, borrowing, and managing capital. Built on Ethereum and Optimism, TrueFi’s capital markets connect investors, borrowers, and capital managers for uncollateralized lending into both crypto-native and real-world financial opportunities.
TrueFi removes the middleman and is able to offer lenders better yields and a range of financial opportunities normally reserved for the wealthy, while providing multiple layers of loss protection against defaults. TrueFi also helps portfolio managers and borrowers to access global liquidity using familiar permissionless lending pool mechanisms, combined with novel new DeFi products TrueFi is bringing to market soon, such as an Automated Line of Credit (ALoC).
TrueFi offers the infrastructure for lending, borrowing, and managing assets. Because TrueFi is a decentralized protocol, it also relies on its own TRU stakers to provide some loss protection to lenders, govern the future of the protocol, and execute on other matters necessary for TrueFi to continue to grow.
Since September 2022, TrueFi has originated more than $1.75B in loans and paid more than $40M in interest to TrueFi lenders. Their borrowers include leading institutions within crypto, as well as real-world finance firms working in fintech and credit. Impressive to note that in its first 2 years, TrueFi has enjoyed a relatively low default rate of 1.3% vs a standard of 1.3% annually in traditional finance borrower default rates.
When lenders supply USDC, USDT, TUSD, or BUSD to borrower pools on TrueFi, they can also stake the receipt token on the TrueFi Farm page to earn additional TRU token incentives, which is a familiar way to bootstrap liquidity with lenders. Currently, the maximum net yield for lenders is 12.4% APY for USDT lenders. Although there are currently no borrowers using USDT, the TRU farming incentives are highest for USDT lenders.
Today, I’ll show how I can earn ~12.4% APY by lending USDT to TrueFi.
Before we get started, please be aware of these risks.
Smart contract risk in TrueFi, which could be protected against by buying Nexus Mutual cover here
Front-end spoof attack on the TrueFi app website
Exploits in economic design
Borrowers defaulting on loans despite the backstop plan TrueFi has called SAFU to cover for borrower defaults
Systemic risk in DeFi composability
Pegged assets like stablecoins can potentially de-peg
Liquidity can be an issue for lenders looking to withdraw if 100% of a pool is utilized, but currently, none are at capacity
Credit scoring is still a more centralized process, that’s not been made public, but worth noting the community in TrueFi hasn’t pushed ot make it public
Avoid the BUSD pool given a recent BUSD borrower default (see here)
Step 1: First, assuming I have USDT already on Ethereum Mainnet, and I wish to lend it to TrueFi, I can go here to the Lending Pools, connect my Ethereum wallet, specify how much USDT to deposit and follow the prompts to Approve + Lend (2 transactions).
Step 2: Then, I go here to the TRU Farms page and stake my tfUSDT. I follow the prompts to Approve + Stake.
Using the SUI Testnet For A Potential Airdrop
Sui is a proof-of-stake Layer 1 blockchain being developed by Mysten Labs. The company is led by ex-Facebook developers who worked on the social media giant’s Diem blockchain initiative and raised $300M in September.
More details about SUI tokenomics can be found here.
In this tutorial, we’re going to set up a wallet and try out a few apps on the Sui testnet in the hope of qualifying for an airdrop when the mainnet goes live.
Step 1: Create a Suiet wallet
Install the browser extension and create a new wallet.
Step 2: Get some test tokens
Click the ‘Airdrop’ button in the wallet to receive 0.05 SUI. You can get more after waiting for 5 seconds.
Step 3: Grab your SUI name (similar to ENS)
To do this you’ll need to install Sui wallet as the site didn’t let me connect with Suiet. I transferred some test SUI from the first wallet.
Connect your wallet and purchase your domain of choice for 0.001 SUI.
At the time of writing, I wasn’t able to claim due to an error. I’ll give it another try in a few days.
Step 4: Swap some USDT and DAI on MovEX
Connect your wallet and click on ‘Claim test token’ on the top-left.
Again, the transactions wouldn’t go through but I’m sure the issue will be resolved soon.
After claiming the tokens, swap between them a few times.
Add some liquidity on the Pool tab.
Step 4: Try out new protocols as they deploy on the devnet.
The APTOS airdrop turned out to be quite lucrative for testnet participants, who were able to cash out $2,000-$15,000 depending on their level of activity.
Sui is similarly hyped with substantial VC backing so let’s hope that our early efforts pay off down the road!
🪂 Airdrop Alpha
In each DeFi Alpha guide, we update a list of DeFi protocols that have yet to announce and/or launch a token.
Layer-2 rollup Arbitrum kicked off a months-long program on June 21.
Participants will be able to claim NFTs based on completing various tasks.
Week 1 was Bridge Week and we walked you through it in a previous issue of DeFi Alpha.
In a previous Degen Tutorial, we covered a series of on-chain quests.
We’ll be watching for the Odyssey to resume, now that Nitro is live.
Congratulations if you followed our guide betting on a hunch that Optimism would release a token!
In a previous DeFi Alpha, we covered a series of on-chain quests that could make you eligible for the next round of $OP airdrops.
$OP is Live! Claim guide here.
Arch Finance – a protocol for comprehensive indices that provide access to differentiated sources of market risk.
Aztec – an open source L2 bringing scalability and privacy to Ethereum, with zkSNARK proofs, having launched a private DeFi yield aggregator zk.money.
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
Lens Protocol – A decentralized composable social graph, underpinning an emerging landscape of Web3 social media dApps including Lenster, Lenstube, and Orb
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
StarkNet mainnet is live! Bridge and swap some tokens for a potential airdrop. Guide here.
SudoSwap has released details about its SUDO token and airdrop.
If you followed our guide from August 12 and created some trading pools, you should be eligible!
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.
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.