June 3, 2022: Curve Yield Leaderboard 🔝🔢
Updates on $PAL, $OHM, $SILO, $ANGLE, $UDSN, $PUSd, $FXS, $BADGER
The other day I was surprised to see a TradFi bank account paying about 50 cents in interest per month on a $1K deposit. Are rate hikes actually getting passed on to the consumer and not just being hoarded by the banks?
We’ve all heard DeFi is ded. Is it so rekt it will soon get outperformed by TradFi?
Much to my surprise tho, Curve is still delivering good yields. Who knew?
Here are the top ten tAPR pools with nearly $1MM TVL or more.
Despite the boomers who like to pretend Curve is just like-kind stablecoin pools, the majority of these top yielding pools are v2 pools. Today we offer some updates and education (not financial advice) on the top ten.
$PAL
It should be little surprise that Paladin, which brands itself “The Ultimate Ally for Better Governance” has mastered the Art of the Curve War. The Paladin team has long studied how to maximize the power of on-chain governance voting, and cleverly concluded that veCRV is ripe for optimization.
Lost amidst the frenzy of the bera, Paladin’s launch of Quest has found a great product-market fit. The mechanics of Quest are pretty easy:
Quest creators can set the desired amount of veCRV that they want for a gauge, set the reward budget with a whitelisted reward token, and then specify how many periods they want to run the Quest to know exactly how much they’re spending for 1 vote of veCRV. This fixed cost is paid out to committed voters on a weekly basis.
It’s being put to use to great effect by Paladin among others, with the PAL-ETH pool popping to the top of the leaderboards.
To learn a bit more about Warden, check out this great AMA in which Paladin and StakeDAO enjoy a thoughtful and nuanced discussion dissecting Curve tokenomics and much more:
$OHM
Degens who want to write off Olympus DAO may have forgotten the protocol still has a large footprint around DeFi thanks to its multi-million dollar treasury of protocol-owned assets. This includes a juicy 5.8% share of DAO-owned CVX. This has been what juiced the OHM-ETH pool to an appetizing 110% tAPR.
Of course, this may be insubstantial compared with the value of staking $OHM directly on Olympus DAO. Nonetheless, the Curve pool has accumulated a few million dollars worth of value for users interested in diversifying yield.
Since $OHM’s surprise collapse in January, it’s entirely possible the gods are smiling again upon Olympus. Since early May, the token has been steadily climbing in value relative to ETH.
Notably, this coincides with the period in which they launched Inverse Bonds, in a (3,1) effort to absorb sell pressure against $OHM. For brief periods of time, this turned $OHM deflationary, and it’s possible the market is catching up to this fact.
We’re always bullish on protocols that keep shipping through rough times. If you wrote off $OHM after the January incident, perhaps it’s time to take another look.
$SILO/$FRAX
Another amazing example of BUIDL the Bera energy a is $SILO. We last highlighted the team in March when the intrepid @crypto_condom swashbuckled them past governance to earn a gauge. Since this time, the 2021 ETH Global Hackathon winners have finalized details for their upcoming beta program.
The TL/DR behind Silo Finance is that they’ve built a lending protocol based on siloed assets, to avoid contamination risk. Once you’re safely deposited into a Silo, you can borrow through by using the underlying asset to bridge among their network of other assets.
They’ve recently announced the assets you’ll be able to deposit throughout the beta period, featuring several popular tokens.
They’re completing their audit now, at which point the next item on their roadmap is to push their beta live. If you want to learn more about the talented team, Yunt Capital released a detailed writeup:
$sdANGLE/$ANGLE
The first option with less impermanent loss risk is the pool for $ANGLE and its StakeDAO wrapped equivalency. Keeping the motif alive, Angle Protocol is also shipping into the bear market. This week they dropped their gorgeous new app.
Sadly it’s not available within certain banana republics.
This sad consequence is activating our FOMO heavily, as we observe from a distance the inventive ways they’re reimagining stablecoins.
Described as a decentralized, capital efficient and over-collateralized stablecoin protocol, they’ve deployed several agTokens pegged to real-world stablecoins and created a robust platform to trade perpetual futures, earn yield, and get leverage.
At a time when people are seeing Euros deducted from their bank account for the privilege, it’s easy to see why their 15% interest on an $agEUR is making a splash. Here’s a good discussion for your listening pleasure:
$USDN
If you’re looking to earn on your dollars, USDN is undoubtedly the best yield source on Curve. However, be mindful that the reward comes with its fair share of risk.
We’ve been closely following USDN, particularly since the collapse of UST. The backing rate of USDN tumbled in the collapse to a low of around 20%, causing some fears USDN would be the next stablecoin to depeg.
The team countered with an emphasis on restoring the peg.
Among the actions taken to restore the peg, it included a $500K bribe in the most recent Votium round. They’re also acting to stop flow of USDN out of WAVES. At the moment the backing rate has reversed its downtrend, hitting 49% at publication.
For disclosure, the author of this piece had previously held a small USDN bag through all the turbulence of the past year. It was a reckless choice to be sure, but one which generated great yields. After the Terra collapse, the author’s sole reaction was to cash out of USDN (at a good profit) for fear of potential contagion.
As it turns out, those who risked staying in the pool profited in this instance. Still, the author plans to sit on the sidelines a bit longer before he’d consider aping back in. Your appetite for risk may vary of course!
$PUSd
Highlighted in great detail already this week (now unlocked), the PUSd pool is another interesting choice for dollarcoin yield that has already rocketed up the yield leaderboards.
Users should be aware of recent developments for the pool since the last article. The pool is interested in moving from an A parameter of 50 down to an A parameter of 25. To protect existing LPs, the lifeguards are requesting everybody exit the pool to prevent impermanent loss in the intentionally imbalanced pool. Further details and warnings in this thread:
The entire incident caused some tense debate among the increasingly salty crypto community. We won’t link the theatrics, which are easy enough to find yourself.
We’ll only note that in a time of universal mental disorders, being mentally stable is a revolutionary act. We’ve got a long time until the Fed allows prices go up again people. Make this the summer of your sanity.
$FXS
When looking over the Curve Wars, you can never forget about FRAX. The protocol maintains a large and growing footprint.
The recent launch of Convex’s FRAX portal has already attracted hundreds of millions of dollars earning strong yields.
To keep up on the activity around the FRAX ecosystem, check @BarryFried1’s thread summarizing FXS strategies:
$cvxCRV
We presume cvxCRV is well known to degens at this point. Since the peg dropped to a low of 97%, it’s proceeding to recovery at 98% and a 70-30 balance.
Don’t take my word for it though, enjoy 0xplok’s great Dune dashboard.
$CRV
By now $CRV is hopefully well-known to readers of this Substack, so we won’t spill too much ink on the subject.
We’ll only note that if you’re dissatisfied with the Llama Airforce quote for staking cvxCRV at the moment…
… then take a look into Aladdin DAO Concentrator’s more substantial quote.
These things fluctuate so often, we don’t tend to play the game of hot potato in chasing the higher number. Especially as these calculations are known to lag in some cases. Still, we’re presenting it for you here so you can NFA, DYOR, et al.
$BADGER
With BTC outperforming ETH lately, it could be a good moment for Ethereum users to look at BADGER, the home of BTC on ETH.
In particular, the BadgerDAO community has been heavily focused on the upcoming launch of Citadel. The team recently released a good read on their vision for governance:
If haters aren’t interested in the ~20% Curve yield on BADGER/WBTC, you can also play around on Balancer, where Badger’s been using Hidden Hand to steer >50% rewards.
See — we may be Curve maximalists, but our ultimate allegiance is to the truth. By pointing you to good yields even when they fall outside Curve, we hope it ultimately builds our credibility overall.
We’ve got a long bear market scheduled by our overlords. To more you can earn idle cash flow and go out and enjoy the sunshine, the happier you’ll be when numbers start going back up!
Disclaimers! Author has exposure to $OHM, $FXS in addition to flywheel assets.