Hey folks, if you’ve been following me for the past few weeks, you’ll know that I’ve been pretty keen on different plays on Mantle, one of Ethereum’s most exciting Layer-2’s. Today I’m going to be doing a bit of a deep dive on Swapsicle, and why I think it’s an extremely underrated platform and worth keeping an eye on.
Why? Let’s breakdown what Swapsicle has to offer…
Triple Digit Farming Returns on Stablecoin pairs
The most notable LP on Swapsicle is the $USDC-$cUSD pair which involves $cUSD, a synthetic form of USD, which much similar to Synthetix.io’s $sUSD, is minted on Reax.one once a user adds sufficient collateral:
With a straightforward borrow/lending collateralization model, lenders will get their collateral liquidated if the underlying assets’ value goes below the value of what they borrowed.
Quadruple Digit Farming Returns on Bluechips
Usually we only see degen returns on liquidity pairs on obscure low-market cap tokens, but with Swapsicle you’ll mostly see different combinations of stablecoins, $ETH, and $WMNT:
Now of course with paired volatile assets, it’s always important to take into account your risk of impermanent loss, for even if your bullish on both $MNT and $ETH — if $ETH pumps and $MNT stays stagnant, you’d experience impermanent loss because you’d be missing out on the gains if you were holding all of your assets in $ETH.
Variable and Estimated APRs
If you notice in the previous graphics, each LP shows a ‘Max APR’ and an ‘Average APR’ — for instance, $WMNT-$WETH has a Max APR of 1238% and an Average APR of 422%. The reason for this variability is because of Swapsicle’s incorporation of Algebra’s concentrated liquidity tech stack, where APRs can be adjusted in relation to your risk appetite and price range. Swapsicle’s UI will also give you an estimated risk and profit score which will adjust with your selected price range:
In general, the larger price range you select will be a bit safer yet less profitable, and vice versa the tighter the range, the more risk and the more profitable your returns.
54% APR paid out in $MNT
Last but not least, currently you can earn 54% APR paid out in $MNT through Swapsicle’s Ice Cream Van. Users can stake $SLUSH which turns into $ICE, where payouts in $WMNT are generated from transaction fees. To note, right now the majority of the APRs aren’t actually generated from fees, and instead it’s because it’s boosted, meaning that they’re most likely subject to change — just a few days ago the APR was above 80%!
Other takes and considerations
With any crazy high APR plays, there’s quite a few factors to consider before aping in…
Exposure to altcoins: $SLUSH is an altcoin and in each and every one of Swapsicle’s strategies— whether you’re getting paid out in $SLUSH or staking it in the Ice Cream Van — you’ll run the risk of being exposed to it’s volatility. In that same vein…
Low Marketcap = High Volatility: It’s been actually relatively stable for the past couple of weeks, but $SLUSH, Swapsicle’s native token, is a very low marketcap coin, which means there’s a significant chance that you’ll see significant swings in price action. Additionally because of it’s short time on the market, we most likely are still in price discovery mode.
High Rates usually aren’t sustainable: As I mentioned before with the Ice Cream Van, some of these rewards are boosted, so all the yield isn’t necessarily organic. Additionally if Swapsicle’s liquidity TVL goes parabolic, conversely the rewards will probably decrease significantly as well. The larger the LP, the smaller slice of the reward pie each one gets.
Conclusion
It’s clear that the Swapsicle team has been hard at work building, and it’ll be interesting to see how well they’ll be able to attract liquidity as the Mantle ecosystem continues to grow. With more integrations and partnerships with other budding protocols like Reax Finance, I imagine that we’ll see a lot more exciting features to ship out soon.
And as always, thanks for taking the time to read this and be sure to follow me on twitter (https://twitter.com/CryptosWith) to get all my latest updates. If you want to get access to all my draft links or get an idea about what’s next on my docket before I publish, find me on Friend.tech, where I share all that information in my chatroom. Also, looking for a gift for your Crypto-loving/hating friend? Give them a REKT journal to cheer them up!
And as a final reminder, please weigh your risk appetite before entering any high-yielding vault — if you need a better explanation as to why, check out my PSA.
Disclaimer: This is not financial advice and this is for educational and entertainment purposes only. Please as always, do your own research and find what investments are best for you. Cheers everyone!
