hey, I’ve been in crypto a while but just starting to look at DeFi. Looking to share ideas and feedback.
I want to put some of my long term BTC holdings to work in a way that isn’t too risky. I want to stay exposed to BTC, but gain interest.
I know there are centralised platforms like blockfi offering 6% on BTC, but I think i can do better.
my initial idea is to:
- change BTC to wBTC
- use the wBTC as collateral on AAVE, borrow 100% the value of the BTC in stablecoins, at about 4% interest
- put the stable coins in the curve Y pool
- use the yearn vault to automate selling the crv rewards
- if better pools or rewards show up, switch
- when finished after a year or more, exit the pools, pay back the loan at about 4%, get my BTC back and keep the profits
how does this sound? I know that there are risks of contracts being hacked and stablecoins failing, but I that feels ok to me.
any suggestions for improvement? is it possible to get a leveraged loan on the BTC? is aave a good lender?
Stani, founder of AAVE, already proposed something Add new yVaults with Credit Delegation to Increase ROI
Also, the LINK vault works with AAVE and it has been doing quite good.
ok this means I would be borrowing/buying link and being exposed to the price change of link though, right?
The link strategy consist In depositing it on aave and loan stable coins that are put to yield farm. The earnings are used to buy more link that is send back to aave again. The vault manages the health factor of the loan so it keeps far from being liquidated.
Hi Ant, interested to know how this discussion progressed. Did you opt to deposit wBTC on AAVE?
I am also just seeing this and wondering how things went, if the went at all.
Hi, I did do this in the end. I went wBTC > dollars via AAVE platform > leveraged COMP mining via instadapp. the returns were about 30% APY on the dollars.
in the end I was distracted by other ‘degen’ high yield but high risk strategies, offering higher returns. But now that the wave of ‘degen’ high yield stuff seems to be dying off, I might go back into this.