I allow myself to create this topic in order to discuss the opportunity of exploiting the strategy offered by pJAR 0.88 (pDAI farm).
According to its results and the various opinions concerning it, it is a success :
- a steadily increasing TVL
- a very competitive yield
- use by other protocols, most of which wish to preserve Pickle’s stability (Yearn, yAXIS, Stabilize)
- the support of the community as favorite for the attribution of rewards
In this context, and if it is feasible, I would like to see proposed a new jar with a single asset, like USDC for example.
I made a spreadsheet based on the values of Compound.finance at a time T:
- USDC being used as collateral
- DAI as a loan.
- These two assets offer interesting $ COMP rewards.
I simulated the values obtained with a collateralization rate of 80%, and a value of USDC equal to 1.01 DAI.
The spreadsheet has only 15 rows and the starting bet is 1,000,000.
This is what it looks like (EDIT : picture above show you USDC one asset strategy):
If I was correct in my calculations, the rate of return would be 17.96% APY ! with a leverage of 3.79x.
Decreasing the collateralization rate lowers this leverage (2.92x lev@75% coll = 14.93% APY).
Regarding the redistribution of interest, I’m not sure how that would apply for Pickle … autocompound USDC + reselling $ COMP for USDC or DAI ? or against PICKLE ?
I would like your opinion on this idea as well as on the method I used.
Am I wrong in my calculations?
Have I forgotten some data or information?
Is this the method used by the pJAR 0.88?
To be honest, I am waiting for the availability of the borrowing option in Furucombo.app to test this strategy individually.
(This application allows you to group various transactions into one, and saves on gas costs!)
Assuming that this is achievable, what would you think of a “pJar” using this strategy for ETH?
A collateralization ratio of 50% would provide a return of almost 9% APY, based on previous data.
I leave you access to my spreadsheet if you wish to make any comments whatsoever. I can give you access in copy and on request (by email).
Thanks for your feedback
I have updated my spreadsheets.
It seems obvious that a strategy with a single asset is more relevant!
The first sheet presents my initial idea (I could not borrow the same asset that I collateralised in Compound, before today)
The 2nd sheet considers only DAI, the 3rd only USDC and the last one presents a strategy with ETH as collateral up to 50%, with USDC as borrowed asset.
If anyone knows how I could automate the values of a cell (% APY, ETH value …) in a Google spreadsheet, I’m a taker