[Serenity Premium (Preview)] Benqi Folding [Initial Review Jan 2023]
Benqi is one of the biggest lending protocols on the Avalanche chain, next only to Aave. In this strategy, we might also use an automation tool protocol Cian.
The Strategy in this Article
Deposit USDC into Benqi, borrow AVAX and convert into sAVAX for staking yield. For the sAVAX received, it can deposited into Benqi again to borrow more AVAX. Repeat this till an optimal borrowing rate is achieved (a.k.a folding). This is a tedious process if it’s done manually; so you can use Cian’s pre-built strategies to do the same.
Current yield: 8.9% (12 Jan 2023)
Our risk assessment: Medium.
Our yield projection based on this week’s Benchmark Yield: 7.4%
The Concept and How the Protocol Works
Benqi is pretty basic for most of the readers of our series. It’s a plain vanilla lending and borrowing protocol on Avalanche…..
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(Serenity Team, 13 Jan 2022, Twitter: https://twitter.com/SerenityFund )