Farming with Pangolin, Crodex, Inverse Finance
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.
This week's farming opportunities span across Ethereum, Avalanche, and Cosmos ecosystems. The 3 opportunities we cover include the following:
Is a community-driven decentralized exchange for Avalanche and Ethereum assets with fast settlement, low transaction fees, and a democratic distribution–powered by Avalanche. It has very active marketing and just released their V2 farms, with boosted rewards which will last for another 2 weeks before getting reweighted every 2 weeks after that. There are farms for many Avalanche native tokens, but also some stable farms yielding around 20%.
Is a DEX on the Cronos Network, which is an EVM compatible chain running in parallel to the Crypto.org Cosmos Zone. Crodex is one of many DEXs that are generic forks of Ethereum counterparts like Uniswap and offer incentives across a number of pairs with their native governance token $CRX. Around $20M TVL at the time of writing, we will focus on stablecoin yields across Crodex and other DEXs such as VVS and CronaSwap within the Cronos ecosystem.
Inverse.finance is a suite of permissionless decentralized finance tools governed by the Inverse DAO. There are three main products offered by the Inverse team. They include Anchor, DOLA and DCA Vaults. Anchor is a money market and synthetic asset protocol enabling capital efficient borrowing & lending. DOLA is a stablecoin and DCA Vaults enable you to invest your tokens into yield bearing strategies while continuously buying a target asset of your choice with the proceeds, allowing you to dollar-cost-average (DCA) into an asset such as ETH, WBTC or YFI over time.
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.
Each farming opportunity will follow the same format:
If we utilize Nansen dashboards, we will give a tutorial/guide on how to recreate the dashboards for your farming activities.
Pangolin is a community-driven decentralized exchange for Avalanche and Ethereum assets with fast settlement, low transaction fees, and a democratic distribution–powered by Avalanche. It has very active marketing and just released their V2 farms, with boosted rewards which will last for another 2 weeks before getting reweighted every 2 weeks after that. There are farms for many Avalanche native tokens, but also some stable farms yielding around 20%.
V2 mostly focuses on tokenomics, so conceptually the farms still work like most other DEX LP farms. The APY consists of trading fees paid in LP tokens and $PNG emissions, which is Pangolin’s governance token.
As for most DEX there are a multitude of farms, we showcase our favorites which have either impressive overall APY or good APY for a specific token or token “family” (e.g. stables) compared to other products. Note that all the farms are for tokens on Avalanche.
At least during the period of boosted rewards, Pangolin offers very attractive yields in their native token $PNG. V2 offered massive changes to the $PNG tokenomics, aiming at putting more long-term value on the token itself. However, with these heavy emissions right now there is attractive yield with $PNG incentives.
Cronos launched their mainnet a month ago and have seen an explosion in growth with over $1.4B in TVL and a maturing ecosystem that include many native DEXs. We will focus on some of the stablecoin yields for these DEXs as they offer competitive yields. Cronos Network is an EVM compatible chain running in parallel to the Crypto.org Cosmos Zone - the first EVM compatible chain on Cosmos. It is built on the Cosmos SDK and leverages Tendermint for consensus.
Crodex is one of the few DEXs on Cronos and it is very similar to its Ethereum counterparts like Uniswap. It currently offers incentives across a number of pairs with their native governance token $CRX and has around $20M TVL at the time of writing. Although we will highlight Crodex, we will focus on stablecoin yields across other DEXs such as VVS and CronaSwap, which are also within the Cronos ecosystem.
The stablecoin rewards are decent across all of these DEXs in addition to some of the majors like ETH, BTC, AVAX and MATIC to name a few. Note, there are other farms not mentioned where users can earn higher yield on their $BTC and $ETH but they would require taking on exposure to the native protocol token. Once a user bridges funds over to the Cronos Network, you can participate in any of the DEXs mentioned. Note, gas fees are paid out in $CRO so ensure you have enough $CRO in your wallet. We would recommend having at least $5 worth of $CRO to start. This report was written during a very uncertain market, so we wanted to ensure members can get a diverse set of stablecoin opportunities such as the ones mentioned above.
In order to participate, you will need to add the Cronos Network and transfer funds over. There are multiple ways to do this and we will go through each.
Please reference our in depth guide that provides step by step instructions on how to get started with the Cronos network. When you are finished transferring your funds, you will then need to provide liquidity to your desired pools. We will have our farming guides below for each DEX.
Farming on Crodex
Farming on CronaSwap
Farming on VVS
Inverse.finance is a suite of permissionless decentralized finance tools governed by the Inverse DAO.
There are three main products offered by the Inverse team. They include Anchor, DOLA and DCA Vaults. Anchor is a money market and synthetic asset protocol enabling capital efficient borrowing & lending, while DOLA is a stablecoin. DOLA can be borrowed by using other assets on Anchor as collateral or it can be bought directly. It can also be used as collateral to borrow other assets on Anchor. DCA Vaults enable you to invest your tokens into yield bearing strategies while continuously buying a target asset of your choice with the proceeds, allowing you to dollar-cost-average (DCA) into an asset such as ETH, WBTC or YFI over time.
By depositing to Anchor you are making your asset available for borrowers to borrow. You can also use your deposited assets as collateral to fund your own borrowing from the protocol.
Inverse.finance DCA Vaults generate yield on stablecoins and continuously invest the yield in a target token e.g. ETH, WBTC or YFI.
When you deposit a stablecoin, you receive a vault token at a 1:1 ratio. As long as you hold that token, you continue to earn interest. When you withdraw your stablecoin, the vault token is burned, and you receive the deposited stablecoins back. You can claim your earnings at any time without having to withdraw your stablecoin.
There are currently four Vaults:
In simple terms Earn X token (as interest) on your Y token (principal)
Inverse.finance is an interesting project introducing innovative financial tools and concepts. The yields being offered are all based on the Ethereum network. There are good yields being offered by the project, especially for WBTC and ETH. The stablecoin yield is also decent which naturally comes with lower risk. Being able to use deposits as collateral on Anchor is also an additional benefit that enables leveraged positions. The DCA vault is one of their flagship products and is suited for low-risk strategy implementations. The option of depositing a stablecoin and getting the interest paid in another asset could be attractive during the bear market. This strategy allows the accumulation of ETH, BTC or YFI using dollar cost averaging, while protecting the principal from volatility. Additionally, this vault is also attractive to investors that are not willing to take the risk of buying the target token directly but want some exposure to it.
It is important to note some risks, however. Smart contract failure, arbitrage and liquidation are all possible. Furthermore, failure of the DOLA stablecoin USD peg due to market conditions is also an additional risk to take note of.
Depositing with Anchor
If you wait a few seconds or refresh the page, you should see confirmation of your supplied assets.
Borrowing with Anchor
You can borrow up to 70% of your loaned USD asset balance. Borrowing less amounts results in lower liquidation risks.
The interest accrued from your borrowings is added to your borrow balance, therefore the balance of borrowed assets that you need to repay will grow over time.
Depositing to DCA Vault
DOLA can be acquired using any of the following methods:
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!