2024-01-25 ETHBTC-THANG! Day 242

Let's do the ETHBTC-THANG!

I record the price of $ADA from @Indigo_protocol and the $ETH and $BTC prices from @Levana_protocol.

The EMA20 indicators favor the { $ETH, $BTC } -> $ADA swap. I'm not going to do this swap, but this tells me NOT to buy $ETH or $BTC with $ADA today.

Okay, so! I'm not trading { $ETH, $BTC } -> $ADA, but $ADA is undervalued. Am I trading $iUSD -> $ADA?

Fair question. How do I answer it? [spoiler:]

WITH A SPREADSHEETSZORXEN!

My formula calculates that $ADA is only slightly undervalued, so I won't trade $iUSD for $ADA today.

2024-01-25 Indigo portfolio

incept date: 2023-07-27

0.01228 $iBTC: $487.63

0.7104 $iETH: $1,559.29

2,643.25 $iUSD: $2,643.25

778 $ADA: $360.14

total fees $63.63

total yields $592.50

net yields $528.86

APY: 23.75%

invested: $4,465.58

value: $5,050.31

ROI: 5.03% / 10.09% APR

Indigo Analysis

You see my HODL portfolio in @Indigo_protocol has gone down. Am I concerned?

No.

1. It's still net+
2. When it goes net-, that's an indicator for me to infuse capital into this portfolio.

Why?

I am long-term bullish on $ETH and $BTC. Them going down is a buy-signal for me.

2024-01-25 ETHBTC-THANG! Day 242

The ETHBTC-THANG! 

• no swap; no EMA-ratio δ

ETH: 3.94153 / BTC: 0.0966

Total: $12,487.25 TVL EMA-20: $12,329.13

n.b.: TVL EMA-20 indicates that ETHBTC, itself, is cruising!

ROI: 2.89% / 4.35% APR

Chart Review

Let's go over each of these charts, in turn, because each chart means something.

I'll show how I use each chart to grow my ETHBTC-portfolio

1. the ETH/BTC ratio vs. EMA 20

This chart tells me when to swap $ETH for $BTC or to swap $BTC for $ETH and how much to swap.

• When the blue line (the ratio) is ABOVE the red line (EMA20), $ETH is overvalued, vis-à-vis $BTC, so I swap $ETH for $BTC
• When the blue line is BELOW the red line, I swap $BTC for $ETH

Today I do nothing, as red and blue are kissin' 😘

2. ETHBTC trading portfolio, total value

This chart tells me my ETHBTC-portfolio is undervalued or overvalued with respect to $ETH and $BTC's intrinsic value.

• When the blue line (value) is ABOVE the green line (EMA20), the I'm 'overvalued,' so I cruise.
• When the blue line is BELOW the green line, I'm 'undervalued,' which tells me I should infuse capital as BOTH $BTC and $ETH in my portfolio's combination are currently undervalued.

3. ETHBTC: value-proposition of swaps

Given: HODL'n $ETH and $BTC as a portfolio is a good thing, ...

Does trading $ETH for $BTC (or vice versa), using the ratio-vs-EMA20 indicator, add MOAR value?

This chart measures my swaps, showing:

Yes, I DO BUIDL value by swapping. 🎉

Measure

What if my swapping DIDN't add value over HODL'n ETHBTC as a portfolio? What then?

Would I quit swapping?

No.

The ETH/BTC ratio does work for many investors. If my value-proposition of swaps were negative, that would indicate I'd need to improve when I swapped and by how much.

Measure, folks.

Measure, measure, measure, and, if you aren't sure, and, even if you are:

Measure.

That's the take-away.

You see how well you invest by measuring now. Then you see if you're improving by continuing to measure.

Measures drive improvement and innovation.

4. ETHBTC Portfolio composition

This is a different way at looking at the value-proposition of swaps. You see, here, there's a dance between the 50/50 $BTC / $ETH I started with, tending to all $ETH (as $BTC was overvalued), then easing back to some $BTC (as $ETH was overvalued)

Putting Liquidity to Work

You also see in the chart --^ that I have a LOT of $ETH, ...more than I can trade in one day.

And $ETH has an LSD ('liquid stake derivative'): $wstETH.

There are several ways I can take advantage of this liquidity that's just sitting around, in fact: I can put it to work.

How?

Ghost

1. I put an estimated couple of days of $ETH and $BTC trades as reserves by lending both to @TeamKujira Ghost.

You see, at present, $wETH lending rate is 17%

HOLY WHAAA???

And $wBTC lending rate is 4.5%

which is also very good.

Unlike some other money markets, @TeamKujira Ghost pays its lending rates as APRs!

What does this mean, APR vs. APY?

It means this:

• Lent $ETH is paid in $ETH!
• Lent $BTC is paid in $BTC!

Not in some protocol token.

Ghost's lending rates, folks, are the real deal, and no joke.

wstETH

2. You can swap your $ETH to $wstETH.

By simply HODL'n $wstETH, instead of $ETH, you earn a 3.5% APR on your underlying $ETH.

3.5% may be meh, but it's 3.5% more than simply HODL'n $ETH.

So, yes: I swap my extra $ETH to $wstETH for that reason, ...

...and other reasons.

Arbitrage

The "and other reasons" includes this:

I arb $wETH with $wstETH on @TeamKujira FIN.

Here I replace a filled buy- and sell-order with a new buy- and sell-order (yes: again).

How much did I make on each?

ROI: 20.09%; 431.44% APR for the sell

ROI: 2.29%; 208.66% APR for the buy

Let me highlight one thing from these trades on the wstETH/wETH @TeamKujira FIN order book:

I sold $wstETH, buying 0.43 $wETH at the discounted price of $1,858; the market price is $2,211.

I simply placed the order: I made $151 with that one sale.

Folks, you can do this, too.