High APY on stablecoins

Stable Coin strategy for a Bearish Market

By Cosmonauta | DeFi Degen | 13 Feb 2022

Recent developments in economy and political fronts is not playing good with crypto market, and to be honest I am not trusting it will back up soon (who am I? absolutely not an investment advisor 😅).

Let's get back to our stablecoin strategy, you can usually get something between 5-15% easily in many platforms (for example on Curve or at your favorite CEX platform). As we know, one the most reliable in the scene is UST @ Anchor Protocol. Because of recent degenbox shitshow (highly opinionated) caused a moment of UST/MIM pegging issues it resolved rather quickly. But in any case you should be informed how UST keeping its peg to a dollar (tip: It's an algorithmic stable coin, and it keeps it value with $LUNA: of course it's more than this).

What we need for getting good APY on UST?

1) Deposit UST @ Anchor Protocol which will bring you about 19,50% APY. You can even stop here, relax, if you think 19,30 - 19,50 % is good enough for you. Anchor protocol gives you aUST which is interest bearing token for your UST.

Anchor Protocol

If not:

2) Deposit aUST as a collateral @ Edge Protocol (you receive aUST when you supply UST @ Anchor Protocol)

3) Borrow aUST against your aUST (Edge protocol is lending pool on Terra Ecosystem, which is arriving on 15 February)

4) Supply more aUST and go on with this loop as much as you feel comfortable.

5) ????

6) Profit!


Of course you should check this strategy back on 15 February when the Edge Protocol will launch (There might be a native token as well, who knows? #airdrophunters 😏). You might pay interest because you are borrowing but it would be less than your APY gain. But it's always better making your own calculations with supply/borrow APYs.

Edge Protocol

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DeFi Degen
DeFi Degen

This is my side blog to introduce you to some DeFi strategies on major blockchains, including degen ones! From dex tokens to stable coins... if you have any tips, do not hesitate to leave a comment. As you know, in DeFi space, first come, first served.

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