summary
Maximizing Yield on DFI, Bitcoin, Ethereum, or Stablecoins using DUSD Negative Interest Rate
- Utilize the negative interest rate on DUSD via the vaults on DeFiChain to maximize yield on your DFI, Bitcoin, Ethereum, or Stablecoins
- Showcase two strategies:
- Strategy 1: Only DFI involved
- Strategy 2: DFI and Bitcoin/Ethereum/Stablecoins involved
For Strategy 1:
- Prepare a vault of $10 in DFI
- Borrow as much DUSD as possible (negative interest rate of 28.72% minus 5% vault interest rate, effective APR of 23.72%)
- Put the minted DUSD back into the vault as collateral
- Repeat the process until a factor of 1.33 of your total collateral value in DFI is reached
- If desired, remove some of the DUSD as collateral, swap half into a dToken of your choice, and put both into liquidity mining to earn extra APRs
For Strategy 2:
- Prepare a vault with DFI and USDC (or switch USDC with Bitcoin, Ethereum, or other stable coins)
- Borrow the maximum amount of DUSD possible (factor of 1.33 of your DFI collateral value)
- Swap half of the minted DUSD into a dToken of your choice and put both into liquidity mining to earn extra APRs for the crypto in the vault next to DFI
- By using either strategy, you can receive the highest APRs currently available on DeFiChain (around 20% APR on DFI, around 40% in DUSD on your DFI, and around 10% on USDC, Bitcoin, or Ethereum)
Comparing Strategy 1 and Strategy 2
- Strategy 1 involves only DFI while Strategy 2 involves DFI and USDC/Bitcoin/Ethereum/Stablecoins
- Swap out the DUSD used as collateral with something else (USDC/Bitcoin/Ethereum/Stablecoins)
- Use the free DUSD to go into liquidity mining and earn extra APRs for the crypto in the vault next to DFI
- Depending on your desired collateralization ratio, add or remove stable coins, Bitcoin, or Ethereum until you reach the minimum of 150%
- By using either strategy, you can receive the highest APRs currently available on DeFiChain (around 20% APR on DFI, around 40% in DUSD on your DFI, and around 10% on USDC, Bitcoin, or Ethereum)