[Weekly] Market Return on StableCoin-based Strategies(9 August 2021)

We provide a weekly update of the platforms we track, based on the strategies discussed in Serenity Fund’s Overview of Stablecoin Investments and the periodical updates.

(Note: Yields derived from mining reward tokens are based on the prices of tokens on 9 August. Yields that are cumulative, e.g. Uniswap and Compound’s basic earnings and Binance funding rates, and are actual yields over last week, compounded weekly to derive the APY.)

Quick analysis on 9 August:

  • Risk Free Rate: 3.67%. Market was hot due to the launch of EIP 1559 but it also attracted more funds to come in. Risk free rate, representing the safe yield from Compound, Aave and Curve, inched up from last week’s 3.77%。
  • Curve/Yearn: The Curve/Yearn Large-Cap Benchmark Rate is now 15%, higher than last week’s 13%, due to a rising CRV. Convex is still leading and cvxCVR has maintained.
  • Other Stablecoin Platforms: the yields vary from 9% ~ 27%, and averaged 17%, decreased from 20% last week. Wasabi topped this category this week.
  • Other (non-USD stablecoin) platforms, aka Exotic Strategies: Exotic strategies are delivering 23% to 46% yield now, excluding Ruler Protocol. Polygon protocols Qi and Polyquity continued to do well. The penalty rate of 4.81% is the difference of Curve’s Aave Pool yield on Polygon over the same pool on Ethereum, narrowed from last week’s 5.32%.
  • Uniswap/Alpha: Uniswap earnings turned positive but remained low, for half stablecoin, half ETH pairs. This is due to a rising ETH that caused impernament loss (probably temporary due to how we estimate it, for further details please refer to our early articles on Hedged Liquidity Mining).
  • Compound Leveraged Yield: at 70% leverage, the total return from this strategy is about 15% plus last week. Note that this strategy can also be used to hedge USDT exposure.
  • Binance Coin-Margined Funding Rate: refunding rates are barely positive, and it seems the market is getting bullish again.

(Serenity Team, 9 August 2021, Twitter: https://twitter.com/SerenityFund )