Upending the FIRE game through DeFi stablecoin yield farming
Decentralized finance, or DeFi, is a broad term that refers to projects on Ethereum and other smart contract platforms that are rebuilding the world’s financial infrastructure on the blockchain. While it is certainly risky, the rewards are currently beyond anything available within traditional finance. Just look at your “savings” account. The amount of yield currently available among DeFi projects can put financial independence within reach for many people. Here, I take a deep dive on how I positioned myself for reFIREment, and allocated an emergency fund that will hopefully pay for itself and allow me to live my dreams.
I won’t get into the details of fiat on-ramps or using the Ethereum network, nor do I endorse blindly following my any of my positions. Black swan exploits and rug-pulls are still a huge risk, and my purpose here is to discuss the analysis and decision-making process that I went through in order to mitigate some of that risk. I hope you find it useful.
Checkbook control crypto retirement accounts, part 2
Well it took me over a month, but I was finally able to buy some bitcoin through my self-directed IRA. Last night, I was finally able to deposit some fiat into my SDIRA’s new FTX.us account, and purchased a few hundred dollars of BTC, wBTC and ETH. The process has been slow and somewhat infuriating, but there is nothing like having the ability to purchase cryptocurrencies within the context of a tax-advantaged account. That’s right, there are no taxable events on activities made with these funds, and once I am able to withdraw to an on-chain wallet, I’ll be able to yield farm to my heart’s content without worrying about capital gains.
We were supposed to have lunch/brunch this last week, but in a perfect example of the type of disfunction that our working relationship has become, we were unable to get our schedules lined up. Friday, my mom came to town, and I had an interview with a VC in the afternoon, and the only time that would have been doable for us was undone by bad traffic. Sunday, we were unable to meet up as well, but for different reasons.
So he called me yesterday and we talked for half an hour. Eight and a half years working together. Elder was only three months old when I started working with him, freshly fired from my last MSP job, and desperately needed something to put food on the table with. He had just retired from the Air Force and wanted to try his hand as business. It was either a 7-11 or this, he had told me years ago.
He told me that he was faced with rebuilding the team from scratch. I was his first hire, and with me leaving was just the capstone on several losses over the past few years that had seemingly defeated him. Or phone technician, never reliable to begin with, had seemingly disappeared, and the only other person on our team, an office manager who had been with us for several months, was moving out of the area shortly after my departure.
We had had no discussions about my possible replacement, and with less than a month to go, I had grown curious as to what his plan was. There essentially wasn’t one, just defeat. The prospect of rebuilding his team, at this stage in the game, was a non starter for him. The only problem was his contractual obligation to the franchise home office, to which he was still bound to for eighteen months, or some two hundred thousand dollars. He was seeking a buyout or merger with another franchise, or group.
I told him that he shouldn’t consider this experience a failure. To have made it eight years was a considerable achievement. I tried to take responsibility for my part in the failure, I just wasn’t the right person to lead a team at the time, basically, and we had missed our window of opportunity several years before, causing some self-owns that had interrupted our trajectory and crippled us mortally. We had just been bleeding out since then. We had a moment, trying to recall all of the people who had worked with us over the years.
There were of course external reasons at work as well. Our area is heavily saturated with competition, and the market has become exceedingly commoditized over the years. Ultimately, I don’t think the system that the home office franchise provided was scalable for a small office. I became burned out several years ago, having to manage the intricacies of some half dozen vendors and systems: RMM, PSA, backups, AV, M365, more and more with varying degrees of interoperability and APIs. I’ve written ad nauseum about it here on this page in the past. It boiled down to something that was cumbersome and hard to replicate. I had come to the conclusion that the only way to survive was by conglomeration, but we were unable to make that work.
And I am done. I’ve given him two months already since I declared my retirement, and I have today and four more Fridays to go. He said he was going to try and merge with a group based out of St. Louis, to pool resources, and I agreed that it was his best option, but he needed to act quickly as I wasn’t looking forward to any awkward support calls to my cell phone in June.
Before we ended I thanked him for the opportunity, and told him that if he ever changed his mind about crypto and wanted to get in, that I would be more than happy to help him. I think I went on trying to explain what I had been doing the last few months with SAIADao. He mentioned that we had recently gotten on some military contractor list that would give us the opportunity to do some blockchain work. I couldn’t help myself and shot it down, which is probably another perfect distillation of our working relationship these past years. No, I told him, that’s going to be private blockchain work and there’s just no reason for me to focus on anything like that, it’s probably IBM, and blah blah blah I went on.
The week has been flying by. Missus’s birthday was Tuesday, and I don’t think we’ve quite recovered yet. The entire house is a wreck, I do not think there is a single room in the house that is clean. I’m not sure who’s been doing the litter box. It’s all I can do to tear myself away from the computer to put dinner on the table. I managed to cut the grass last night, but there’s so many other things that need doing around here that are just getting ignored. I’m sure my dad’s surgery didn’t help either.
I’m slowly working my way through the Rustlings tutorials. I’m actually further along than I was when I first tried to do these on summer vacation last year, so that’s progress. I think number one on my project list right now is a yield farming autocompounder. I just went through my STEP-USDC pool on Raydium: claim rewards, swap half, all liquidity, stake. Rinse, repeat every day as long as the pool is active. I need to automate it.
I wish I had something to automate proposals on DaoHaus. I think I finally got people to help me out, it seemed like I was the only one doing anything. I’d like a custom front end to make tribute proposals easier to calculate, and something that can automatically process ones that need processing. I wish I had a lot of things.
There’s really just too much to work on, and I think I’m close to capacity. Work, i.e. Zombie, LLC, is taking a negligible amount of my time, but it’s one of those things that I have to address as soon as it comes up. Seventeen more days. I’m going to have to say ‘no’ to more things if I’m going to get anything done around here. There’s so much I need to do that I can’t keep up with.
So what’s my first priority around here? Running the house, I suppose. Keeping the kids fed, making sure that they’re cleaning up after themselves and not spending all day eating candy and watching TV. Making sure Younger is getting her lessons in during the afternoon.
Number two? Keeping the fires out for my Zombie clients. I’m avoiding starting any new projects, which seems to be easy as there aren’t really any. I’m not sure what my boss is going to do. I don’t think he’s found a tech to replace me, and I don’t know what he plans on doing after June 1. He sure as hell isn’t going to convince me to stay on. I’ll let him pay my LLC a $1000 retainer plus $150/hr if he needs to pick my brain, but I am so ready to put this behind me.
Everything else? Oh gee, let me make a list… don’t lose money, make money, get new windows for the house, fix our hot tub pump even though no one will service our brand, plan a trip out home, enroll Elder in Galileo XP this summer, sell my mining rig, learn Rust, Solana, and front end development; make enough money trading/farming to avoid dipping into the reFIREment fund. Is that enough for now? I don’t even know what’s on the Trello board for house stuff, let see: repair two holes in the walls and paint, stain the deck, clean up the no-mans-land in the backyard, put house numbers on the mailbox; numerous tiny items.
It’s overwhelming when I think about it, which is why I suppose it’s better to not think about it and just focus on the next big task. I say family is the most important, but it’s easy to get wrapped up in what I’m doing and only give the kids half my attention when they come interrupt me or I hear them bickering in the next room. All I can do is focus on what’s in front of me, today’s task, and try to make sure that I’m not taking on more responsibilities. It’s no use agonizing over the things I’m not getting done, even the ones that I said I’d do. My priorities shift so fast, it’s the same flightiness that I’ve always struggled with. Is it ADHD, or is it something different. Regardless, there’s always more to do, so I better get to it.
I procrastinated writing this morning’s post as I didn’t know what I was going to do today, and it seems like it was a good idea because today was Uniswap V3 launch day. And it was a bit of a mess. The main problem came down to the same EIP-712 signature issue with Metamask and hardware wallets. You just couldn’t use the V2->V3 migrator, as it relied on a signature to approve the conversion. Opps. The entire Uniswap Discord was full of people with LP tokens on their hardware wallets that they couldn’t migrate! Myself included. I wound up moving my UNI/ETH LP over to my Metamask softwallet address and migrating it there. It’s not safe, so I’m moving it back to my hardware wallet right after I finish posting this.
I had some other tokens on my Lattice1, and ran into the same problem, even though they had just pushed out EIP-712 support a few days ago. There was a slight problem with the Metamask plugin that the team was able to patch, and I was able to confirm it right away. This means that the Lattice is currently the only hardware wallet on the market that supports this important signature scheme.
I’m a bit miffed by Uniswap’s lack of communication on this lack of hardware wallet support in their migration process. They must have known about it, but just decided not to mention it on their docs? Granted, it is the fault of Metamask and the hardware wallet providers that this hasn’t been fixed in the last several months, but Uniswap could have at least given people a heads up.
The migration is expensive, it cost me $150-160 for the two I did, and you have to know what you’re doing. You can’t just use the old zero-to-infinity LP provisioning that underlied Uni-V2, you actually have to look at a chart and figure out what sort of range you want to do. With my UNI/ETH LP, I opted for this range, which I figure should good for a while.
As long as the price stays in this range, I’ll be providing LP, if it moves out, I’ll have either 100% ETH or 100% UNI. This is a lot different from the impermanent loss that we’ve become used to. If the price drops to the bottom of my range, my position is all UNI. If it goes higher, it’s all ETH. This is a much different risk model that what we’re used to.
The other big thing here is the collect fees button. Before, fees were rolled up into the protocol directly into the LP, but now it’s a separate button that can be claimed separately. I’m not quite sure what the design decision was behind this, but it seems curious. I suppose one could just wait until they remove liquidity, hopefully the fees will roll out with it, but I can’t see myself using that feature too often. Not until when Optimism launches and it won’t cost me $40 to claim it.
This is an interesting system, and it’s going to be interesting to see how things play out in the coming weeks. Liquidity mining is going to be very interesting to watch, to see how teams who have been relying on V2 LP tokens deal with these new NTFs. It’s going to require a completely different paradigm for project launches. Staking contracts will have to be re-written completely. So far, it doesn’t look like anyone has tried to provide V3 liquidity for Klondike’s kBTC/wBTC pairs, but I wonder if it would be possible to provide concentrated liquidity on V3 that would essentially absorb all of the fees on V2. Perhaps. There does seem to be some arbitrage opportunities between the V2 and V3 pools now, but I’m not likely to have time to mess around much with that for now.
Other updates: The SAIA Dao continues to grow, we’re getting a constant stream of contributors, and it’s become a lot of work to keep pushing these proposals through. I’m trying to get people to help me a bit, as it’s taking a lot of time to flush these proposals through every day. I’ll probably just shift down the amount of time I check them, and just stick to sponsoring and enacting them.
I aped into the Step.Finance token on Raydium today, right before it dumped — of course. The APY is ridiculously high and I haven’t lost 2% yet so I’m going to hold and compound these rewards daily. It is quite ridiculous right now, even if it is only supposed to continue for a few weeks. Step basically wants to be the Zapper of Solana, and it could be very lucrative.
My Impermax IMX/ETH leverage is still sitting pretty. 1.8x or so, even though I need to check it right after this. I’m wondering what Uni V3 is going to do to the V2 fees. It may destroy their entire operating model. We’ll know more after we have some volume data. This may be a very dangerous position to hold right now, but I’m playing with airdrop money so I’m not really concerned. Might wind it down if gas costs come down. We’ll see.
The World Computer launches on Friday. After several years, of development, Dfinity is going live. I have not been paying enough attention to this one over the years. I took a look over some docs earlier, but I don’t want to distract myself from the work I’m doing in Rust right now, but I’m going to listen to the launch event and maybe buy some tokens. They’re apparently only going to be on Coinbase Pro, which may limit my options. We’ll see.
What a day. My father had open heart surgery yesterday, and I was his primary contact so I’ve been keeping the rest of the family appraised with updates. I went to see him this morning. He looked like he had been hit by a truck of course. It’s a bit surreal, actually. His sister passed away unexpectedly after New Years, so my grandmother and surviving aunt have been worried about him. They live eight hundred miles away, my brother is across the Atlantic, and his wife doesn’t drive, so I’m the responsible one. It’s nuts.
Also today was my wife’s birthday. I took the kids out shopping for decorations Sunday to buy a bunch of decorations, and I picked up a cake with the groceries today. Ordered her favorite pizza joint, and basically binged-watched all of WandaVision this afternoon. I also got her a Kindle Paperwhite and loaded it up with a couple hundred books from my pirate collection. That’ll keep her busy!
Work? What’s that?
I did have one phone call for a support ticket that I’d been putting off for a few days, called the vendor and had it resolved in an hour. More like ten minutes after I got through the call queue, but that’s billable time these days.
SAIA Dao is open to $1000 contributions now, and we had maybe five proposals including my own today. I’m also have been making a nice little profit flipping posters on OpenSea. Only four so far, but I’m still doubling my money, even considering gas fees.
I had another bout of insomnia last night, and decided to open another leveraged position on Impermax. The internet died right after I placed the order, so I had a little bit of anxiety trying to go back to sleep. I woke up and found that my liquidation prices were not anywhere near where I thought they should have been, so I had to scale the leverage back. I found out later there was a “graph error” that was causing problems, but I seem to be holding steady right now. I still haven’t committed any further funds other than a few DPI, but that’s mainly because gas costs were high earlier and lending rates came down a bit.
Usually when I get overwhelmed and can’t decide what to do, the best option is to do nothing. I’ve got a ton of LINK from the ICO that I don’t know what to do with… Bancor or Integral or a CEX, I’m not sure. Maybe at some point I’ll figure out how to stake it. But I’ve got wBTC and stables that I want to farm on Impermax, but not sure I trust it yet. I’ve got no idea what my BTC is doing in the new Badger Yearn vault cause the APY isn’t being displayed. I’ve got native BTC that I want to put to use on the RUNE DEX, but don’t have enough RUNE to do that. I just finished buying the last off my SOL allocation and put half of it to use in the Raydium RAY/SOL farm. What else?
God, what else? I’ll probably have a lot more to say in the morning.
So I’ve been somewhat occupied with a new lending protocol for the last day or so. It’s called Impermax, and it allows one to use Uniswap liquidity tokens as collateral for a leveraged position. You can also supply one or two of the borrowed assets in each pool for a nice APY, with no risk of impermanent loss. I’m just testing it out after getting an airdrop, and it advertises as the first DeFi protocol that allows you to use LP tokens as collateral.
I read the whitepaper last night, it was written last year, and has a lot of math detailing the liquidation system. The system seems pretty well put together. There’s a core system, that holds all of the user state, and upgradable proxy contracts for the rest of the implementation. This design also allows for third parties to interact with the core system as well, meaning that it could be put to use in third-party protocols at some point.
Each Uniswap LP token gets its own pool, so a liquidation in one pool does not affect the others. For each pool there are three smart contracts, the LP collateral contract, and one each for the components of that LP, borrow A and borrow B. Lenders can provide either of borrow A and B, or both, and borrowers deposit LP tokens, and leverage their position by borrowing both tokens and staking on Uniswap. Here’s what it looks like after I took my IMX airdrop and opened a 5x long last night.
You’ll noticed the liquidation prices, there are two, representing an upper and lower band. The reason for this is that if the ratio of token A to token B gets out of whack, then impermanent loss can make it difficult to repay the loan. Here’s a chart of the band a couple hours after I opened my position last night.
Now there still seems to be some problems with the system, especially with regard to the liquidations. I got liquidated on the above position, which clearly shouldn’t have happened. I was only playing with a small stack and lost a small portion of my LP collateral, so it wasn’t too bad. Generally speaking, you want a leverage position that you won’t have to actively manage. The USDT/USDC pool seems like an obvious play here.
Borrowing is expensive, and is supposed to be offset by farming emissions via the IMX token, but there appear to be some issues with whether this is actually working properly right now. Supplying assets seems very lucrative, and it’s taking every bit of self control I have right now to keep from staking every single stablecoin, ETH and wBTC token that I have into the pools right now. And since the asset in each pair is in a separate contract, you can provide both assets and earn yield without worrying about IL.
On the topic of security, the protocol has several audits available, but with TVL only at $20 million right now, I’m not sure that IMX has been battle tested enough to warrant anything more than a small position, but I’m definitely looking at allocating some C tranche funds from the BCM reFIREment fund. In all, I’m very excited about Impermax’s potential. It’s got some kinks and improvements that need to be made, but it’s appears to be very lucrative for anyone willing to ape into it. Managing a leveraged position can be costly, but yield farming seems like a no-brainer.
I spent an hour managing my BSC farms yesterday. I had to migrate several farms due to the PancakeSwap migration, and that took a bit of work to do. I decided that because I don’t have a ton invested on there that I should liquidate some of my positions, so I pulled out of a Beefy.Finance pool 1 that was down. Ellipsis is doing pretty well, so I’m happy with that one and thinking about increasing my stake. Comos isn’t doing too good, but I’m not sure what to do with it, and I’ve got positions in Nerve, Blizzard, Wault. I think that’s it.
Also, I found one of my Metamask wallets had about $400 in $ICE tokens that were airdropped. Nice. Sold half to stake LP in pool 2.
I finally got the latest tranche of IRA funds onto an exchange, so I’ve been scooping up ETH and wBTC. The wBTC is going in the new Badger vault. I put some funds in ALCX and paid off my loan since there’s really no point to that for me. I decided to stake in the pool 2, cause I am super bullish on this project after listening to one of the founders on Bankless’s podcast.
My boy Tres was shilling some token called $TRU, so I went and aped into that after reading that the LP was paying off real well. It is. $272 in the couple hours since I aped in. Not bad.
I’m not quite sure how I found out about Method Finance, but I decided to go in on this. It’s like Visior, in that it’s an NFT with LP tokens staked to it. I minted a vault then added some tokens to the LP, but then ran into a problem. Metamask doesn’t support EIP-712 signing with hardware wallets. So rather than import my hardware keys into MM, I moved the NFTs, the LP tokens, and some ETH over to an unused MM wallet to perform the mint. (That’s how I discovered the ICE airdrops.) I’m not happy about leaving it there, but it’s too much gas to move back and forth, so there it will stay for now.
I found out about Impermax via BadgerDao’s airdrop channel. I had some tokens so I minted LP and staked there. It allows you to use your LP as collateral for a leveraged position, but I’m not quite sure how it works. I’m also not sure if I want to risk my Uniswap LP over there. It is audited, and the APY is really high, so I’ve got some risk analysis to do. Also looks like I messed up, I thought that I could just deposit my LP and earn, but that’s not how the lending works. It has to be single assets. I’ve got some digging to do, but 1000%+ APY on 5x leverage seems like it might be… fun.
I also pulled my MATIC tokens out of Aave and put them in a QUICK-MATIC LP and am farming them on Quickswap. EZPZ.
I also started buying more SOL, and swapped a bunch for RAY and staked it on Radium. Will be going hard on this.
Other than that, the only thing I didn’t get to today was getting some more RUNE. I want to figure out how to put some to use, either with some of the BTC I have, or on the ETH side.
And now that the week 1 Star Atlas posters are down, I might actually be able to start flipping some of these posters. We’ll see how things go.
Today marks the end of the week 1 Star Atlas NFT sale, and I’ve been trying to figure out what sort of plan I’m going to put in place. I spent some time this morning trying to figure out how many I would have to sell in order to flip my way up the ladder. I calculated what it would take if I was able to get 200% and 150% of the original purchase price. This is if I wanted to have two of the fourteenth poster, one I could sell.
The game theory on this one is hard to work out. We’ve got both Solana and Ethereum mainnets, and no way to bridge assets from one to the other — yet. I assume the Star Atlas bridge will be one-way, but haven’t confirmed that yet. They also haven’t launched the market yet, so OpenSea is the only real place to sell them at this time.
If I hold to my risk profile, I’ve got enough funds to buy a dozen of the first three posters, but that doesn’t account for gas costs to manage the sale, or bridge costs if I eventually have to send them over to Solana and put them to use. It’s a risk, and I’m not sure quite what I’m going to do yet.
There have been a few thousand posters sold on the Solana marketplace, but only a hundred or so on OpenSea. I think Opensea is more likely to appeal to people who are interested in the NFTs so much more than the in-game items. And the starting cost for fourteen posters is only $900, so I think I may go ahead and move forward with that now and see what I can do.
First off, if you had asked me two weeks ago if I would be privy to a half million dollar NFT deal for a space-themed metaverse game, I would have thought you were crazy. Maybe I should stop thinking that. So last Saturday, we formally launched a dao to pool funds to buy these Star Atlas meta-posters, and yesterday, one of the members has entered into a simple agreement for future tokens (SAFT) for the entire set. It’s nuts. The deal is still being worked, but it’s pretty much a sure thing from my understanding, so now there’s a bit less pressure on me to move fast.
We are still going to be working out lots more details in the next couple days. I’ve got to figure out my stake, within this side deal, and how we integrate it into the broader organization that is the Interstellar Alliance. There is a lot of work to do. I have a call with a hedge fund guy who invests in the NFT space, so we’ll see if he’s interested in participating.
I’ve got a busy day. I’m still technically employed, so I do have a couple outstanding issues that I have to deal with. My mom is stopping by for breakfast on her way through town, and I was supposed to meet my boss for lunch later today. That’s going to be an interesting meal. We also have a “date” with a local entrepreneur and his wife, we’re going to bring the kids over for a swim and hang out, so I’m looking forward to that.
One thing is clear to me already. Quitting my job is opening up a host of possibilities that I don’t think I would have access to if I was still trying to hold onto it. Of course we’ll see how it turns out in the long term, but right now, it’s looking pretty damn good.
Another beautiful day, and it’s hard to believe that the week is already halfway over.
Yesterday was Workers’ Memorial Day, and my wife, a Union activist and leader, threw a small rally to commemorate the occasion. We had about twenty people there, and press from the local newspaper and one TV channel. It wasn’t a great turnout, but considering that most of her local are work from home now, it probably wasn’t too bad. We brought the kids and let them hand out stickers and posters for people. They were actually well behaved, which is nice.
Funding for SAIADao is moving along, we’ve got thirteen funding proposals at a hundred dollars each. One member was able to discover a discounted pre-sale from the Atlas Co. team. I’m still trying to verify the details, but it seems that our timeline has accelerated. It’s like one of those late-night infomercials: ACT NOW, SUPPLIES ARE LIMITED!
I still really can’t stress how fascinating this whole thing is. The Solana architecture is amazing, and I can’t wait to start digging into it — once I catch up on Rust — and the vision behind Star Atlas is pretty ambitious as well.
This is probably the biggest, nerdiest thing I’ve ever done, forming an investment dao to purchase a bunch of virtual goods for a video game. I kid though, Star Atlas has the potential to be more than a video game, there’s a serious opportunity to make real money here. It’s a very long-term play though.
I’m feeling a little bit of pressure to come up with funds. Alto is still holding up my transfer because of “upgrades”, and I’m feeling a bit perturbed considering all the effort I had to go through to move things around. Meanwhile ETH is holding $2700. I’m considering selling some $MUG tokens to cover my share in the dao, and I’m also looking at buying a pack of week one posters on OpenSea using my IRA wallet, and reselling them in the coming weeks. The only question is whether I have the liquidity to make this a multi-week play. Do I spend my lot on a bunch of week one posters and try to resell them, or do I just try to see how high I can climb the rewards. I dunno.
Still, I’ve already met a bunch of interesting people and I’m sure no matter what happens with this particular proposal, that I’ve made some interesting connections that should pay off in time. Well see.
I also found out last night that I turned down a six-figure job offer. I interviewed with the Lattice1 team a few weeks ago, but we all could tell I wasn’t feeling very enthusiastic about it, and so they went someone else. They told me last I was their top pick, but I just wasn’t keen about it. From where I was standing, with all the focus on retirement, I just couldn’t bring myself to going right back into another “job”. I’ve spent over eight years with Zombie, LLC., as the key man with basically no backup, and I just want a damn break. Hopefully I won’t look back on this in a year and regret it.
I don’t think I will. I’m following my heart right now and it feels great.
So we are off to a great start this morning. I got a great night’s sleep, basically slept like a rock till 7:30AM, and meditate outside before popping open the laptop. It’s a beautiful day outside today, high sixties and cloudy. There’s a nice breeze outside, and everything is so green.
I had a nice voice chat with a couple of the potentially bigger SAIADao, I can’t say again how excited I am about doing this. There is so much opportunity. For right now though, there isn’t much to do for it other than make sure the proposals are moving through.
I have been trying to learn as much as possible about Solana. I’ve been reading the docs at night and listening to podcasts about it. I’m feeling really bullish on it, and cursing the fact that I got stopped out of a trade on it and Serum so long ago. Alas.
I have a huge tranche of funds that I pulled out of my brokerage IRA, but now Alto is holding it up, and haven’t responded to my emails for two days. It’s all the more frustrating because I’ve seen them do it in one day before. I’m already missing out on a moderate BTC run, and ETH is at ATH, so I’m really feeling anxious. Once that last ACH clears, then it should only be a few hours over to my crypto exchange, and then I can deploy the funds.
Index Coop’s FLI token, a 2x leveraged ETH derivative, has been a very good investment. I bought in with ETH at $2000, and so I’m up quite a bit here at $2700. I think that’s going to be my preferred play for right now.
Rune is exciting as well, but I’m not paying as much attention to it since I don’t really have enough right now to do any major staking. I wanted to use it to put some native BTC to use, but the return right now is quite modest from what I understand.
I’m trying to figure out how much of my ‘bitcoin’ allocation I want in native BTC, and how much I want in wBTC. Native BTC is less risky, but the opportunities in DeFi are starting to show up. Badger launched a Yearn vault that is over 100% right now, including about 15% in native BTC, and that’s the best I’ve seen out there. It’s limited right now, so I’ve also got fund in Klondike wBTC/kBTC pool, Bancor’s IL-protected pool, and have been using Vesper.Finance’s vault as well.
I had originally planned on putting 20% of my funds into DPI, but BasketDao seems like a much better deal right now. It’s got interest-bearing versions of the same components, and the farming opportunity for its BASK token is much more lucrative. I did take advantage of the Zerion DPI/INDEX cash back promo last week, but as soon as that airdrop clears I’m throwing my DPI in the converter to be make bDPI.
And Alchemix, oh Alchemix. I am probably going to do something here a bit crazy. Now that the Star Atlas NFTs are on OpenSea and I’ve secured the first one for SAIADao, I’m looking at buying a few extra. They have 50-pack for poster one on there for $3200, that I might purchase and try to flip. I could post $6400 in Alchemix, take out a loan, buy USDC and buy the 50-pack basically risk free. Once the sale is ended I could post half of my posters at maybe twice the price and see if they sell. Or maybe I’ll bundle them and make Tier 1 or Tier 2 bundles. There’s a lot of ways to go about it, but starting with an Alchemix loan might be a way to protect myself from the downside.
Worst case scenario, I’ll have fifty Tier 0 rewards that would redeem for in-game rewards worth about 90% that I could sell as well. There’s a lot of opportunity here. I haven’t breached the subject of using an Alchemix loan to cover the full $500k NFT purchase; we don’t have the funds, and it’s not worth my energy to try and sell them on the possibility at this point. We’ll see how things go for the next few weeks, my attention is better spent elsewhere for now.