Crypto is out, Gold is inšŖ
šØBEST GOLD YIELD GUIDE EVER MADEšØ
I'm only half-joking. But definitely bookmark.
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Gold is difficult to get a native yield on. Virtually all gold yields involve collateralizing a gold derivative and farming against borrowed stables.
That said, you can deposit smart XAUT/PAXG collateral on @0xfluid for ~4.5%
Next, we'll look at where to borrow against Gold...
1) @MorphoLabs
I love morpho and am currently using it for my own gold farming.
Pros:
ā Highest LLTV at 77%
ā 5% borrow cost
ā Only large EVM market with both PAXG and XAUT
Cons:
ā¢ Thin liquidity compared to Aave
ā¢ Isolated margin (could be a pro?)
2) @aave
Aave has XAUT
Pros:
ā¢ Borrow USDC, USDT, USDe between 3-6%
ā¢ Billions to borrow on mainnet
(no one else compares)
ā¢ It's Aave
ā¢ Deep liquidity on Plasma and Ethereum
ā¢ Cross margin
Con:
ā¢ 75% LLTV slightly lower than Morpho
ā¢ No PAXG unless I'm blind
NOW, for yields, the math is simple.
LTV * (stablecoinYield - borrowCost)
Example:
ā¢ 50% LTV
ā¢ 4% Borrow Cost
ā¢ 20% APR on Stables (Pendle is my go-to)
0.5(20%-4%) = 8% net APR on your gold.
Pretty dang good for a gold yield
Don't forget liquidations!
āŗ Drawdown to liquidation = 1-(LTV/LLTV)
āŗ Liquidation price = price*(LTV/LLTV)
Ex:
ā¢ Gold: $4200
ā¢ LTV: 50%
ā¢ LLTV: 75%
Drawdown to liquidation = 1-(.5/.75)
= 33%
Liquidation price = $4200*(0.5/0.75)
= $2800
SO, what are some good ways to farm this and their net APRs?
Assume borrow at 5% and 50% LTV.
1) XAUT | PT-AIDaUSDC: 12.5% (med risk)
2) XAUT | syrupUSDT Loop: 13.5% (higher risk)
3) XAUT | Simple Lend-Agg SummerFi: 3% (low risk)
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