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Yield Farming Strategies

Strategies that utilise earning fees by providing liquidity to acquire yield for user

Stablecoin only strategies

These strategies only utilise stablecoins and do not enter any volatile assets at any point
  • Stargate stable farm
  • TraderJoe & Vector farm

Stargate stable farm USDC

Protocols & Pools Used: Stargate - USDC (avalanche) Pool TraderJoe - STG-USDC Pool
Description: The strategy deposits 100% of USDC into Stargate farm on Avalanche which is a bridge that connects multiple blockchains. Everytime a user wants to transfer the funds over the bridge they have to pay a fee which is where the yield rewards for the liquidity providers come from. On top of the liquidity providers also earn STG token which is sold for USDC and reinvested into the strategy itself.
Risks:
  • If Stargate bridge were to be hacked and the funds would be drained from it, the user's funds might be lost
  • Standard smart contract risks
  • USDC depeg risk
Emergency Exit Thresholds
  • Stargate Finance USDC pool TVL drops below 3 times the size of the TVL in the strategy (constant monitoring)
  • Stargate Finance USDC pool TVL drops under 1m (constant monitoring)
  • USDC price drops 3 - 5% (constant monitoring)
  • Malicious governance proposals; sudden increase in total supply of Stargate token (constant monitoring on discord channel "proposal-pages")
  • Stargate Finance Protocol gets hacked (constant monitoring on Stargate Finance Discord announcements and Twitter)
  • Stargate Finance Protocol on Avalanche gets Exploited (constant monitoring on Stargate Finance Discord announcements and Twitter)

Stargate stable farm USDT

Protocols & Pools Used: Stargate - USDT (avalanche) Pool TraderJoe - STG-USDC Pool & USDC-AVAX pool & USDT-AVAX pool
Description: The strategy deposits 100% of USDC into Stargate farm on Avalanche which is a bridge that connects multiple blockchains. Everytime a user wants to transfer the funds over the bridge they have to pay a fee which is where the yield rewards for the liquidity providers come from. On top of the liquidity providers also earn STG token which is sold for USDC and reinvested into the strategy itself.
Risks:
  • If Stargate bridge were to be hacked and the funds would be drained from it, the user's funds might be lost
  • Standard smart contract risks
  • USDT depeg risk
Emergency Exit Thresholds
  • Stargate Finance USDT pool TVL drops below 3 times the size of the TVL in the strategy (constant monitoring)
  • Stargate Finance USDT pool TVL drops under 1m (constant monitoring)
  • USDC price drops 3 - 5% (constant monitoring)
  • USDT price drops 3-5% (constant monitoring)
  • Malicious governance proposals; sudden increase in total supply of Stargate token (constant monitoring on discord channel "proposal-pages")
  • Stargate Finance Protocol gets hacked (constant monitoring on Stargate Finance Discord announcements and Twitter)
  • Stargate Finance Protocol on Avalanche gets Exploited (constant monitoring on Stargate Finance Discord announcements and Twitter)

TraderJoe & Vector farm USDC-USDC.e

Protocols & Pools Used: TraderJoe - USDC-USDC.e & JOE-AVAX & AVAX-USDC Pools Vector finance - USDC-USDC.e Pool
Description: The strategy converts 50% of USDC into USDC.e (USDC bridged over from Ethereum). Both assets are deposited into Trader Joe USDC/USDC.e liquidity pool and LP tokens are issued as a representation of the position. The strategy earns a portion of the fees paid for any trading happening in the pool. These LP tokens are further invested into Vector finance finance which provides extra incentives to provide liquidity in form of JOE token which is sold for USDC and reinvested into the strategy itself.
Risks:
  • Standard smart contract risks
  • USDC depeg risk
  • USDC.e depeg risk
Emergency Exit Thresholds
  • TraderJoe USDC/USDC.e pool TVL drops below 3 times the size of the TVL in the strategy (constant monitoring)
  • TraderJoe USDC/USDC.e pool TVL drops under 1m
  • USDC price drops 3-5% (constant monitoring)
  • USDC.e price drops 3-5% (constant monitoring)
  • Malicious governance proposals; like sudden increase in total supply of TraderJoe token (constant monitoring on discord channel “proposal-pages”)
  • TraderJoe protocol gets hacked (constant monitoring on TraderJoe Discord announcements and Twitter)
  • TraderJoe protocol gets exploited (constant monitoring on TraderJoe Discord announcements and Twitter)
USDC.e is USDC that was issued on Ethereum and bridged to Avalanche via the official Avalanche bridge. USDC is natively issued on Avalanche chain.

Delta Neutral Strategies

These strategies utilise higher yield for providing volatile assets but take a counter position to counter the price movements of the assets

DNS TraderJoe & Vector farm (AVAX)

Protocols & Pools Used: Aave - USDC & AVAX Pools; TraderJoe - USDC-AVAX & JOE-AVAX & AVAX-USDC Pools; Vector Finance - USDC-AVAX Pool;
Description The strategy deposits a portion of USDC into Aave as collateral, and borrows AVAX against it. The borrowed AVAX along with the remaining USDC is deposited into the AVAX/USDC liquidity pool on Trader Joe and LP tokens are issued as representation of the position. The strategy earns a portion of the fees paid for any trading happening in the pool. The LP tokens are further deposited into Vector finance which provides extra incentives to provide liquidity in form of JOE token which is sold for USDC and reinvested into the strategy itself.
Risks:
  • Impermanent loss risk in AVAX/USDC pool if the price of AVAX would move a significant amount over a short period of time
  • Liquidation risk if safety measures were to fail (low possibility)
  • Standard smart contract risks
  • USDC depeg risk