How much I made farming UST (stablecoin) for 2.5 months in the TERRA Ecosystem!

By n1ce | DeFi Adventures | 30 Nov 2021

Hi everyone,

i didn't publish an article in a while, but trust me, I have been quite busy. I really want to take the time to write-up on my farming activites and learnings.

Let me know in the comments if you would like to hear more about farming on Fantom Opera, Terra LUNA and my experience with OHM forks (OlympusDAO) and everything else in between.

And that brings us to today's article! As you may know or not know, on the Terra Blockchain powered by the LUNA token, you can earn roughly 19.50% yearly returns on your dollar, in the form of UST Terra's native stable coin. This system is in place since March of this year, which is not that long for a project, but quite a ride for a crypto project where every day can age you for weeks and months.

Anchor is the protocol on Terra which allows for this great yield on your stablecoin. If like to take on more risk, Anchor also allows you to borrow against your deposit of UST. What does this mean? You can take a loan against your position and this is not bad debt because of all the ways to leverage it and earn some more APY.

This is done by the Mirror protocol which offers synthetic assets such as stocks, which is a fancy way of saying that they track the price of these stocks on the blockchain. So what did I do? I decided to short gold, which means receiving a bunch virtual gold against my UST deposit and directly selling it in the hopes that the price will fall and I can buy it cheaper and repay my loan.

The great thing about Mirror is that shorting or longing an asset is also subsidized by the MIR token. That means no matter if the token goes up or down, you earn MIR tokens for your position. Okay but enough of the theory what did I do and how much did I earn?

(Edit: so publish0x for some reason deleted half of my article after publishing it, so I have to rewrite from here, hmpf)


Initial Invest: $4573.76

1. Deposit UST on Anchor, get aUST

2. Use aUST as collateral on Mirror (4000 aUST)

3. Short gold (Mirror buys and directly sells it for you but unlocks the money only after two weeks) ~65 mIAU (gold tracker)

4. I decided to go more risky: deposit the UST back on Anchor after they unlock ($2249.61 on 1.10.2021)

Total deposit on Anchor: $6823.37

But what did I earn after 2.5 months?

- Collateral is now worth $7081.88 = $258.51 since the start 

- ANC rewards: $67 (realized at a good price) + $56 unrealized


= $381.51 = 1831.24 per year or 40% on the initial capital of $4573.76!

Conditions to keep in mind:

- Gold should not increase too much in value

- ANC price and APR for short-farming gold is expected to be relatively stable


That's it, le me know if you tried this or if you have different strategies of farming with your stablecoins!

As always, let me know all questions and feedback in the comments, I try to answer as much as I can.


None of this is financial advice. Please always do your own research.

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Some other posts you might like:

How to get your money out of a liquidity pool even without the farming website (Or the story of my very first rug pull)

How to get some solid returns on your stable coins with IRON Finance on the Polygon Network

Understanding Crazy Crypto Yield Percentages: APR vs APY - The Power Of Auto-Compounding Explained

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