Earn 20%+ on Stables with delta neutral yield farming on Alpaca Finance

Delta neutral yield farming is the hot new thing in DeFi. By borrowing a volatile asset like BNB, FTM, ETH, etc and yield farming it with a stable coin, you can get much better yields. The problem is the volatility and risk since you borrowed the other asset.

New delta neutral strategies allow you to borrow and farm these assets while maintaining a pseudo delta neutral position. This requires essentially going long and short both and constantly rebalancing to stay neutral.

Alpaca Finance does this with their new automated vaults. They use a 3x leveraged position both long and short and automatically rebalance.

I used to do this manually but it was a pain. The constant volatility makes it hard to stay delta neutral. Their automation of the strategy is a game changer.

This allows a 20-30% APY on stables!

Alpaca Finance is an OG DeFi project and has close to $1,000,000,000 TVL. It is by far one of the safest DeFi projects with an insane amount of audits.

Be sure to check out the new automated vaults. There is limited capacity and they fill up quickly. They have vaults on BNB and Fantom.

View Source

11 thoughts on “Earn 20%+ on Stables with delta neutral yield farming on Alpaca Finance”

  1. That seems like a pretty large operation to achieve the same yield we can get on stables with LP-ing today. What am I missing?

  2. Thanks for this. I’ve done a bit of research around delta neutral strategies; can you please clarify the need to rebalance? Is it required if no leverage is being used?

  3. So i’m looking more into the strategy you’ve listed above, and I think it’s great. But one concern; I can’t just deposit USDT into the strategy. I have to buy BNB and be exposed to BNB price fluctuation, is this correct?

  4. I don’t see any stable pairs. If you put your money in a pair that has exposure to a non stable, If the other coin goes down, your position goes down as well

  5. I’d stick to Spool. Its rate might not be as much as that but I’m comfortable with its risk models. I’ve seen enough bad experiences in DeFi to jump in on any protocols with a promise for high APY rate.


Leave a Comment