[Weekly] Market Return on StableCoin-based Strategies （29 March 2021)
We provide a weekly update of the platforms we track, based on the Serenity Fund’s original strategy on investment of stablecoins, and its subsequent updates, most importantly the March Update. The chart below summarises the returns on investment of stablecoins:
(Note: Yields derived from mining reward tokens are based on the prices of tokens on 29 March. Yields that are cumulative, e.g. Uniswap and Compound’s basic earnings and Binance funding rates, are actual yields over the last week annualised.)
Quick analysis on 29 March:
- A rising CRV (with the hype around Ellipsis Finance) had increased the yield of both Curve and Yearn. Some Curve vaults of less popular stablecoins have seen yields about 40%. On the other hand, Yearn’s yield has come down, as its TVL increased faster than its holdings of veCRV vaults. Yearn’s perpetual vault for veCRV, yveCRV, is not trading at a steep discount to CRV, and so Yearn has to rely on organic growth, i.e. contribution of CRV from its strategies, to grow its base of CRV.
- Other stablecoin platforms have mixed performances. Vesper continued to deliver, as its VSP locking incentives (staking and Geyser) are still in force. Frax came back a bit, despite another fall of its fork, Dollar Protocol. Float has stopped its stablecoin mining program and switched the rewards entirely to pool 2, so we have removed Float from the list.
- Exotic (non-USD) strategies yields were around 80% to 100% now. This week’s top earning pool is Mirror Protocol’s IAU-UST pair, thanks to a strong MIR.
- Our traditional strategy of Uniswap Liquidity Providing and Hedging on Binance were still the safe choice, when the market was volatile. Uniswap’s ETH-USDT (hedged) yield was 44% last week.
- We have included Alpha Homora’s yield calculation in the list from this week. Alpha Homora allows us to borrow ETH to stake into Uniswap, achieving the same yield with additional ALPHA token rewards. Its calculation is was the same as Uniswap strategy, except that its mining rewards is the yield on ALPHA less the ETH borrowing cost. The overall ROI is divided by 125%, the additional 25% reflecting the capital used to hedge the ETH exposure in Binance.
In addition, a lot of things happened last week and will be happening this week. Dollar Protocol’s USDf unpegged, in a manner similar to Pegs Cash. Please refer to our twitter thread for more details. The launch of Ellipsis Finance (a licensed Curve fork on Binance Smart Chain) was a great boost to Curve and also the entire industry. In this week, Fei will be launching its token sale and please refer to our medium article on Fei Protocol.
(Serenity Team, 29 March 2021, Twitter: https://twitter.com/SerenityFund)