Yield Farming Report # 5

Yield Farming Report # 5

Farming with Dopex, OolongSwap, Ubeswap

Disclosure: Members of Nansen may be participating in some of the following strategies and farms. This statement discloses any conflict of interest and is not a recommendation to purchase any token or participate in any of the mentioned farms. This content is for informational purposes only and is not investment advice. Please exercise caution if you are participating in these strategies.

Introduction

This week's farming opportunities span across Arbitrum, Boba Network, and Celo ecosystems. The 3 opportunities we cover include the following:

Farms

Arbitrum

Dopex

Dopex is a decentralized options protocol which aims to maximize liquidity, minimize losses for option writers and maximize gains for option buyers - all in a passive manner for liquidity contributing participants. Option pools are created for all options on Dopex, which allows anyone to participate and deposit base/quote for their respective pools to gain passive income from option writing and purchasing discounted options through liquidity pools which could then be arb-ed for an instant profit.

Boba Network

OolongSwap

OolongSwap is a DEX on the Boba Network (formerly OMG network), which is an optimistic rollup on Ethereum. Note, Boba is the only optimistic roll up with a token at the time of writing and has a larger TVL than Optimism. Oolong has facilitated over $240M in volume and has $470M in TVL with the ability to swap and farm a number of pairs. They are incentivizing their pools with their native governance token $OLO and use a booster to distribute tokens.

Celo

Ubeswap

Ubeswap is an AMM on Celo that closely resembles Uniswap. The protocol reused code from its Ethereum counterparts such as Synthetix, Uniswap, Sushiswap and Compound. The contracts have been audited by Bramah.systems. They are currently offering rewards for LPs in their native governance token $UBE as well as other protocol rewards for dual and even triple incentives.

Farming Guide

We will go over each farming opportunity, give step by step guides, and go over the risks and opportunities associated with each of them. Yield from these opportunities may comprise the protocol’s native token and other protocol rewards.

Format

Each farming opportunity will follow the same format:

  1. A brief summary of the protocol we are focusing on
  2. An overview of the popular pairs and their respective yields and risk
  3. Key takeaways from the pools mentioned
  4. Tutorial on how to LP/Farm in the given pool

If we utilize Nansen dashboards, we will give a tutorial/guide on how to recreate the dashboards for your farming activities.

Data as of November 22nd, 2021
Sources: Dopex, OolongSwap, and Ubeswap


Image

Dopex

(website/twitter)

Dopex is a decentralized options protocol which aims to maximize liquidity, minimize losses for option writers and maximize gains for option buyers - all in a passive manner for liquidity contributing participants. Option pools are created for all options on Dopex, which allows anyone to participate and deposit base/quote for their respective pools to gain passive income from option writing and purchasing discounted options through liquidity pools which could then be arb-ed for an instant profit.

The protocol is governed by users via a limited supply governance token, DPX, which would also be used for collecting protocol and app layer fees.

Dopex also offers a rebate system for losses incurred for option writers based on exercised options for every epoch. The rebates are paid in the form of a theoretically infinite supply token, rDPX.

rDPX will gain utility by its use as collateral to borrow capital from the margin pool to leverage option positions or to mint synthetic derivatives of assets supported within the protocol.

As of 24.11.2021, the DPX token is not exactly cheap at 300m$+ MC and 1b$+ FDV, and a fair value for the rDPX token with unlimited supply and 54m$ MC is hard to predict. However, with the launch of the ETH and BTC options upcoming soon (only DPX, rDPX options available right now), there might still be some upside to both tokens hence the decision to highlight these farms in this report.

Dopex is heavily influenced by meme and crypto twitter culture, some of the main public backers include DefiGod and Tetranode - we classify this farm as at least slightly degen.

DPX and rDPX farms

The two farming tokens for Dopex are DPX (“vanilla governance token”) and rDPX (“rebate token also used for protocol usage”), for further info see Tokenomics. For both tokens, you have the option to either do single sided staking or liquidity providing in the Sushiswap WETH pool on Arbitrum:

More detailed information can be found at https://vfat.tools/arbitrum/dopex/

Takeaway

Dopex has a solid vision, lively community and lots of meme potential - right now it is not super cheap but could still have lots of upside. Depending on how much confidence you have in the tokens you can choose between single sided or LP farming which yields very decent rewards, especially when compounding with low gas fees on Arbitrum.

There is additionally the option to deposit your assets in a SSOV (single staking options vault) which allow users to lock up tokens for a specified period of time and earn yield on their staked assets. Users will be able to deposit assets into a contract which then sells your deposits as call options to buyers at fixed strikes that they select for end-of-month expiries. SSOV options are either in the money or out of the money, so the whole process requires a bit more thought than simple farming.

For the ongoing epoch (month) there are no more deposits into SSOVs possible and no more options available for purchase, so it is impossible to give real APRs and actionable insights. If there is further interest, we will cover Dopex SSOVs in a separate report when they are available again.

Tutorial for farming on Dopex

For reference, Dopex itself also published a detailed tutorial here, but we summarized the main points below:

  1. Reference our Arbitrum Wallet/bridging setup here if you are new to Arbitrum.
  2. Head over to https://app.dopex.io/farms  and connect your wallet with the Arbitrum network selected.
  3. Select the farm you want to enter and click on the three dots next to the “stake” button if do not have the required assets already, there will be links to the corresponding Sushi Swap pools for buying the token as well as adding liquidity
  1. For single sided, there is also a “compound” function, for the LP farms you would have to compound it manually into your LP position if you wish to do so


Image

OolongSwap Farms

(Website/Twitter)

OolongSwap is a DEX on the Boba Network, which is an optimistic rollup on Ethereum. Note, Boba is one of the only optimistic roll ups with a token at the time of writing and has a larger TVL than Optimism. Oolong has facilitated over $240M in volume and has $470M in TVL with the ability to swap and farm a number of pairs. They are incentivizing their pools with their native governance token $OLO and use a booster to distribute tokens.

OolongSwap Farming Exposure Summary

Takeaway

Decent APRs for the OLO incentivized pools. Oolong uses ‘Boosts’ to incentivize pools, please reference those in the ‘Boost’ column as they are already factored into the APY. Unlike Optimism or Arbitrum, users can withdraw funds in minutes rather than days. You can also withdraw funds using 3rd party bridges such as Synapse. Note, any farming pair denoted with a red question mark means those funds were bridged over from another chain, not Ethereum. For example, reference the image below that indicates the $AVAX was bridged over Anyswap and not Ethereum.

Tutorial for Participating in OolongSwap Farms

In order to participate, you will need to transfer funds over. Boba Network, formerly OMG Network, is an EVM compatible chain that offers fast exits (unlike other optimistic roll ups), NFT bridging and many other features.

  • Reference our Metamask setup and navigate to the Boba Gateway here
  • Connect your Metamask wallet to the Boba Network by clicking the ‘+’ button. Ensure the details match the following network details
  • Once it is connected, switch your Metamask to Boba L2 by clicking on the ‘Layer 2’ button 2 at the top left of your screen. Confirm in the Metamask pop up that you want to switch networks
  • Note, if you want to switch back to Layer 1, simply click on the Layer 1 button and confirm the network switch in Metamask again

If you want to set up Boba Network manually on your Metamask, ensure the Network details are as follows:

  1. Network Name: BOBA L2
  2. New RPC URL: https://mainnet.boba.network
  3. Chain ID: 288
  4. Currency Symbol: ETH
  5. Block Explorer URL: https://blockexplorer.boba.network

Bridging over to Boba L2

  • With your Metamask wallet set up, we can now fund our wallet by bridging over funds. Head over to the Boba gateway here
  • Connect your Metamask wallet
  • Click on the ‘Wallet’ tab on the left hand side
  • Next, click ‘Bridge’ next to the token you want to bridge over to Boba. You can bridge ETH and USDT at the time of writing
  • Either select ‘Bridge to L2’ or ‘Fast Bridge’. Fast Bridge is faster and charges 0.1% LP fee
  • Input the amount of the asset you’d like to bridge and approve the spend amount and click confirm in the pop up

Farming on OolongSwap

Now that you have a funded wallet that is connected to the Boba Network, let's begin farming

  • Next, head over to the ‘Farm’ tab here and choose a pool that you'd like to farm and provide liquidity to that pool
  • After you provide liquidity, deposit your OLP tokens into the farm. Then click approve and hit confirm in the pop up window
  • After you approve the transaction, go ahead and click ‘deposit’ and click ‘confirm’ in the Metamask pop up window
  • Once the transaction is confirmed, you will be able to see your position in the LP farm and the accrued rewards in real time

Claiming Farming Rewards

  • Navigate to the pools you are participating in and click the  ‘Claim Rewards’ button
  • You will see your unclaimed OLO rewards, click ‘Claim’ and confirm the transaction in the Metamask pop up window
  • Once your transaction is confirmed, you will see your claimed OLO balance in your wallet. If you do not see it, import the OLO token address; Token Address: 0x5008F837883EA9a07271a1b5eB0658404F5

Withdrawing your OLP Tokens from the Farm

  • Navigate to the farm you are participating in and click the ‘Withdraw’ button
  • Enter the amount you wish to withdraw and click the ‘Withdraw & Claim’ button; Note: Any unclaimed rewards will be automatically claimed when you withdraw
  • Confirm the transaction in your Metamask pop up window. Once it confirms, you will see the OLP token back in your wallet with the OLO reward tokens

Image

Ubeswap

(Website/Twitter)

Ubeswap is an AMM on Celo that closely resembles Uniswap. The protocol reused code from its Ethereum counterparts such as Synthetix, Uniswap, Sushiswap and Compound. The contracts have been audited by Bramah.systems. They are currently offering rewards for LPs in their native governance token $UBE as well as other protocol rewards for dual and even triple incentives.

Ubeswap Farming Exposure Summary

Takeaway

Very solid backing and team behind Celo. Ubeswap seems to be just a fork of Uniswap but it consistently has good yields. There is no minimum amount of time required to get rewards. Once your LP tokens are deposited to the pool, they will start earning rewards immediately and you can claim these rewards at any time. Note, if you ape with size, the rewards will go down - in particular, the pools with low TVL.

Tutorial for Participating in Ubeswap  Farms

  • Reference our Metamask setup and add Celo Network to your Metamask
  • There are a few bridges you can use to bridge over funds >> Optics Bridge - Ethereum, Polygon and Celo / AllBridge - Solana, Avalanche, and Celo / Moss - Ethereum and Celo
  • Once you have added the Celo Network to your Metamask and funded the wallet, we are ready to get started farming
  • Head over to the pool tab here and provide liquidity to your desired pool
  • Next, we want to farm the LP tokens. Navigate to the farm tab here and click ‘Deposit’ on the pool you’d like to LP for
  • You will see the total amount of LP tokens you have available for a given farm at the bottom of the window
  • Finally, choose how many LP tokens you'd like to deposit. You can also click ‘MAX’ to deposit all of your available tokens into the farm; Note, if this is your first time farming a new pair, you'll need to approve the transfer and then click ‘Deposit’ to finalize it

Closing Thoughts

We hope you guys found this report useful and feel free to recreate any of the above mentioned strategies for other farms. Please reach out in the Discord to let us know if there are any questions you might have or further opportunities you’d be interested in the Alpha team exploring. 

These strategies involve smart contract risks, IL, and yields can fluctuate. Exercise these farms with caution and best of luck farming!

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