Author: Stephen, Crypto KOL
Compiled by: Felix, PANews
Currently, sustainable and scalable ETH yields >20% are rare. Crypto KOL Stephen summarized strategies that keep the annual interest rate (APR) above 20%.
wstETH
wstETH can be said to be the most popular, competitive, and scalable strategy in history. Even in the most depressed bear markets, the APR usually ranges from 8% to 30%.
wstETH works by leveraging the staking yield of ETH (about 3%) to offset the cost of borrowing ETH (about 2%).
There are four excellent places to operate:
Morpho Labs
Aave
Compound Growth
Euler Labs
Currently, the APR of this strategy is approximately between 26% to 46%. Of course, you can use Contango to automatically leverage these positions to generate TANGO points, OP emissions, etc.
Leveraged weETH
This strategy is the same as the previous one, but this strategy is also eligible for various points and emissions. Therefore, the average yield of this strategy is slightly higher:
ether.fi points
Veda points
LRT2 points
EigenLayer programmatic rewards (such as $LRT2)
The three blue-chip currency markets are the best places for leverage:
Compound Growth
Aave
Morpho Labs
Before considering LRTsquared, EtherFi S4, and Veda points, the APR ranges from 22% to 36%. The actual yield after considering points may exceed 50%.
Note: Although Morpho's APR is currently ranked first, the gap between the top three protocols is not large, so hedging between them can often give you the most competitive and consistently high APR (which can hedge against unstable borrowing rates).
AERO Mining
Compound Growth is currently paying users to borrow AERO with cbETH, ETH, and wstETH as collateral.
At the same time, you can earn about 200% APR in AERO through voting on Aerodrome.
Of course, the liquidation loan-to-value ratio (LLTV) is 65%, so let's look at some reasonable positions:
Loan-to-value ratio (LTV) 50%
Relative AERO liquidation increase: 30%
Total yield from ETH collateral: 100% APR
Loan-to-value ratio 25%
Relative AERO liquidation increase: 160%
Total yield from ETH collateral: 54% APR
ynETH
Spectra is a competitor of Pendle, and although it recently sparked some excitement with its USR pool, the ynETH pool it launched also offers certain market opportunities.
With 0 boost, the APR is 33%, and with boost, the APR can reach 100%.
It is worth noting that if Spectra becomes a real competitor, holding/locking SPECTRA may have a good effect, so increasing some risk exposure to improve yields may not be a bad idea.
gmETH
This strategy is somewhat controversial because gmETH has experienced principal losses.
gmETH is the so-called 'Counter Party Vault', which falls relative to ETH when traders on GMX gain excess returns. The reverse is also true, and it has been the norm in the past.
You can implement this strategy on Dolomite, where the current annual interest rate is about 30%, with a historical average annual interest rate of about 20%.
GMWETH (Umami)
This strategy is very similar to the previous position, but it hedges most of the delta and risk.
Although the current APR is about 16.5%, it has historically been quite high (about 50%), and in the medium-term future, the average APR will exceed 20%.
pufETH
Despite increased competition recently, pufETH has long been a gold mine. The historical APR of this LP (30bps fee tier) has been between 15-50%, with very low rebalancing.
It's like a hidden gem, although it won't last forever.
Sustainable and scalable ETH yields >20% are rare.
You can find some smaller but still incredible opportunities in places like D2LFinance, but making them too public when it comes to smaller positions for smaller yields is self-deceptive.
