Gold: the stable token

Gold is the stable token.

There is nothing stable, at all, about the down-only $USD nor any 'stable'-token based upon $USD. 

That's it.

 

Terra/Migaloo Money Markets, cont.

Let's continue the Terra/Migaloo money market-stufphen from yesterday.

Capapult ($SOLID)

Since I deposited $ampLUNA into @solid_capa yesterday, I mint $SOLID.

Note that Capapult doesn't have an EARN-tab.

Odd.

What, then, is the use-case for $SOLID, other than bidding?

Here's a problem:

@solid_capa lists $wBNB and $wSOL as collateral, but on their dashboard does not have $wBNB NOR $wSOL TVL.

@solid_capa, please list on your dashboard $wBNB and $wSOL provided total values.

Here's another problem, their UX-design is consistent, yes, but it sucks, consistently.

I select a premium rate, ... how?

By selecting the rate on the chart? no.

By entering the percent? no.

By a [redacted] slider. Only.

TF?

I enter my bid by entering the numbers? no.

TF?

Here's another problem on @solid_capa:

How many $ampLUNA tokens did I provide?

I have a dollar value. Nowhere do I see the actual number of tokens I've deposited. So, I'm Canadian, or European, and you give me USD amounts?

Their UX does not provide essential information.

The UX on @solid_capa seems out-of-place for money markets across blockchains, and their entry for liquidation bids is clunky, ...at best.

You make your UX incomprehensible and difficult, you create barriers to entry for potential investors who will take their money elsewhere.

Further, a money market that doesn't have a depositary for their stable token?

I mint $SOLID, but you don't let me earn interest on it?

@ginkou_io has that.

@CavernProtocol has that.

@TeamKujira has that.

@solid_capa – WHO RENAMED THEMSELVES TO THEIR OWN STABLE! – does not.

Now, @solid_capa may argue they've incentivized an LP or two on @astroport_fi.

But guess what other LPs are incentivized there?

$axlUSDC.

Guess what other stable has depositaries on every other money market? 

$axlUSDC.

@solid_capa: please incentivize HODL'n $SOLID, ffs. 

I place liquidation bids for $ampLUNA, $wBTC, $wETH, and $bLUNA on @solid_capa.

My asset allocations are as follows.

I still have (a lot) of $SOLID remaining after placing liquidation bids on @solid_capa (HATE their rebranding).

WAT DO?

I withdraw $axlUSDC from @CavernProtocol EARN-tab and provide liquidity to @astroport_fi SOLID-axlUSDC LP. 

Ginkou

Terra/Migaloo Money Markets, conclusion.

I wuz gunna conclude with @ginkou_io on Migaloo.

But look what happens when I go to borrow against provided-collateral.

'Transaction failed.'

No details. No explanation.

@ginkou_io why is borrowing not working? Please fix. 

Fortunately, for me, I don't need to borrow $axlUSDC tokens to bid on liquidations on @ginkou_io.

Meaning: I don't need @ginkou_io's borrow facility, at all.

I can mint $USK on @TeamKujira BLUE, then swap that liquidity to $axlUSDC on FIN.

When I claim that order, I'll bridge.

It's actually @noble_xyz $USDC, so after some bridging, and bridging back, and swapping, I now have liquidity on @ginkou_io to bid on liquidations.

I do that. 

2024-02-08 ETHBTC-THANG! day 256

Let's do the ETHBTC-THANG!

Before we do the ETHBTC-THANG! ...

ON the ETHBTC-THANG! my sell-order hit for $USK on @TeamKujira FIN, ...

... and holy arbitrage, folks, that axlUSDC/USK board is just 💸🖨️for me!

Sure, it's 0.5% ROI at each trade, but several trades in a day and I'm up $5!

I get the $ADA-price from @Indigo_protocol and the { $ETH, $BTC }-prices from @Levana_protocol.

The EMA20 indicators are meh, and the { $ADA, $ETH, $BTC }-calculator says 'no swap.' So, we good.

SNEK

This, however, does not include my adventure in @Cardano today. I've heard a bit about $SNEK. Whilst my $ADA-reserve is languishing, I'm going to commit 10% of it, or ~$60, to $SNEK, for funsies.

• If $SNEK goes up, yay!
• If $SNEK tanks, I lose my $60: I can live with that.

To that end, I create the SNEK/USD and the SNEK/ADA EMA20 charts. Both give a 'go ahead' for my $SNEK-BUY order with $ADA, so I execute that trade on @MinswapDEX. 

2024-02-08 Indigo portfolio

incept: 2023-07-27

0.01228 $iBTC: $556.07

0.7104 $iETH: $1,726.21

2,380.23 $iUSD

1136 $ADA: $601.19

63823 $SNEK $66.46

total fees $71.71

total yields $635.29

net yields $563.59

23% APY

invested: $4,465.58

value: $5,330.17

ROI: 19.36% / 36% APR

USK: Kujira's stable coin

Hey, folks!

On @TeamKujira Ghost, lent $USK is earning 14% APR. 

HOWTO get $USK?

One way is to MINT to from collateral.

Say you have $DOT. You go to BLUE, provide the $DOT collateral then MINT the $USK

Here's the $DOT minter. 

You can mint from $ARB, $ATOM, $stATOM, $BNB, $DOT, $ETH, $LUNA, $stOSMO, and $gPAXG.

I do the same thing for $wBNB, minting $USK from $wBNB collateral, then I take that $USK and lend it to Ghost.

I'm now earning 14% APR on Ghost from $USK that I minted at 1% mint-rate-per-annum, with a net 13% APR.

Find THAT at a bank, huh? 

Arbitration on Kujira FIN

Stablecoin-arbs

A buy order popped on my $USK-arb on the axlUSDC/USK @TeamKujira FIN board, so I place the sell order there, eyeing the completion of this arb.

This leaves the buy-side empty, so I borrow 100 $USK against 375 $LUNA on Ghost, then start a new $USK-arb.

If you're saying: "This sounds familiar from the ol' geophf, ...", it's because it is familiar.

This now makes the third $USK-arb I've put into play, and my last 4 completed arbs were stable-arbs on the axlUSDC/USK board.

Hey! I go with what works for me, and this works for me.

LSD-arbs

I don't only do stablecoin arbs, furthest from, in fact!

I do:

• $LUNA-bars on ampLUNA/LUNA board

• $ATOM-arbs on stATOM/ATOM board

• NEW $INJ-arbs on stINJ/INJ board

Why do I like the LSD ('liquid staking derivative')-arbs?

Other arbs run the risk of 'just sitting there.'

That liquidity does no work for me when it just sits there.

With LSD-arbs, even if the bid takes a while to fill, AS it sits there, it accumulates more value via the LSD!

KUJI-arbs on KUJI/ATOM and KUJI/LUNA

The stablecoin-arb and LSD-arbs are my favorites, but I now have to add a new favorite trading method to my @TeamKujira FIN-list:

The $KUJI-arbs on KUJI/LUNA and KUJI/ATOM boards.

These arbs require more smarts and more shepherding, but these are an interesting new development.

I'm going to add these two boards to my $KUJI-arb category (or, when appropriate, to the $LUNA- or $ATOM-arb silos), and measure the efficacy of working in these boards.

P.S.: sktd-SCRT/SCRT

Oh, and p.s.:

Did you know I'm ranked in the top-30 @SecretNetwork accounts? YIL this.

It'd be REALLY NEAT WHEN @TeamKujira FIN creates the sktd-SCRT/SCRT order book, won't it now? *hint-hint* 🥺🥺🥺

Fifth Element: Ghost stable arb with hedge

Okay, what's The Problem™️ with my @TeamKujira Ghost-borrow-arbs up to this point?

They're basically shorts, right? You borrow, then straightaway, sell them to arb.

What happens if the markets sky during your arb?

You're eff'd.

I don't like being eff'd, personally. 🥺🙄

... "They're basically shorts."

Hold that thought.

Pigeonhole it, but hold that thought for now.

(Yes, another ANOTHER HOWTO is forthcoming)

(Yes, my mind never stops. Yours?)

Hedging the borrow with a long

So: short. That's one theme to explore.

If the borrow-then-sell an asset is equivalent to a short, then the way to hedge against a sudden market surge (that happens to me on too many arbs, I'm piqued to say), is to open a corresponding long at the same time as the borrow. VOILÀ!

Let's start a working example to illustrate, and make money, because: no dur.

I consult ./vern (my main man: ./vern) who says there's a nice arb on $LUNA.

• LUNA,axlUSDC,OSMO,ATOM,KUJI,LUNA

So, before I borrow $LUNA, I place a 2.2xLONG on 50 $LUNA on the FIN LUNA/USK board.

THEN I borrow 50 $LUNA from Ghost.

With the 2.2xLONG in place, if $LUNA skies, I make out like bandits by closing the long, and paying back the borrow with the profits.

If $LUNA DOESN't sky, then my arb goes through, and I pay off the borrow from the arb.

I'm covered, then, either way.

The point of all the above is to protect yourself from (sudden) market movements.

How do we do this?

A borrow (from Ghost)-then-sell is equivalent to a short; you hedge a short with a long.

That's one approach (hedge short with a long).

There's an entirely different approach.

I eventually do close this arb from a big spike on the KUJI/LUNA board.

Playing both sides

Here's the entirely different approach.

Play both sides of an order book. That way, if the markets go up, or if the markets go down, your arb works, either way.

"Which order book? and how?" you ask.

Fair questions.

The answer is "which asset can you both sell and buy on FIN that you can borrow from Ghost?"

It's a bit 'magical,' but if you consider $axlUSDC and $USK to represent the same thing: a stable coin, you can borrow both from Ghost, and they conveniently marry up on FIN axlUSDC/USK.

The 'magic' of this approach is this: whichever way the markets go, you win.

• If the markets go up, your sell-order hits, creating $USK
• If the markets go down, your buy-order hits, creating $axlUSDC

Okay, so, whichever way the markets go, an order hits.

So what?

That's half the story. So, say, the ratio goes up, and you get $USK from your sell order.

You place that $USK in the buy-range, wait for a ratio-fall, then, ch-CHING! you now have more $USK than you borrowed! YAY!

Those of you with experience doing the axlUSDC/USK-arb will immediately see a problem

1. you have a buy- and sell-order
2. the sell-order hits, you claim that, and place a buy-order

You now how 2 buy orders: you're dependent on the markets again.

Problem: not solved. 😢

In practice this problem is easy to (re)solve.

In the above scenario, you have 2 buy orders, so, place another sell-order.

Market balanced: restored.

"But what if the markets keep going up ... forever?"

This is a problem? Really? Say that out loud like it's a problem.

I'll wait.

Again: in practice, this doesn't happen. Yes, it's a risk, and you're left holding the bag, right?

Nope.

Why?

The neat thing about unfilled orders?

You can always cancel them, and get your money back.

You don't have to have 35,962 orders placed on the axlUSDC/USK book. You can cancel the WAY out of range orders and repay your borrows.

With this out in your back pocket, ... wow.

Just wow, folks.

This means:

1. you get to borrow money at a really low rate (1%-6% rn)
2. you get to make money with borrowed money, that is: OTHER PEOPLE's MONEY! 😱
3. you get to back out any time you feel the heat's too hot.

Risks

So, but with the axlUSDC/USK-arb, borrowing from Ghost, you're not going to get rich quick(ly).

I can borrow 50 $LUNA and make 5 $LUNA in one arb. I did that today.

axlUSDC/USK happens at the rate of, say, $1 gained from two trades of $100.

It's slower, but less risky.

Also, borrowing stables can be expensive, up to 6% borrow rate (annualized), whereas borrowing a volatile coin, such as $LUNA, the borrow rate is usually only 1%.

So you have to watch your borrow rates when borrowing stables.

Just do it!

"So, geophf, given these risks, are you going for the Ghost-borrow stable-arb?"

You betcha. Not only: 'you betcha,' but: you betcha in a big way.

I've set this arb in motion tonight, and, given I prove this out, this is going to be a standard investment tool I go to.

The. End.

Postlude

The markets DID go in a direction (huh! amazing! the markets move. FANCY THAT, HEDDA!), the ratio going up, so I claimed the sell-order and now have 2 buy-orders.

So, I borrowed more $axlUSDC against $KUJI (that I bought with $axlUSDC, hehehe) 

and placed a sell-order.

The balanced-approach is restored. Once again I'm market-neutral: if the ratio goes up, I make money on the sell-order, if the ratio goes down, I make money on the buy-orders.

Either way, I win.

If the markets stay in one direction, I can alway cancel orders and repay borrow.

Case in point

Markets go up; markets go down.

This time, the ratio dipped, filling a buy-order, 

...so my buy-sell orders just magically rebalance when I take this buy order and immediately place it back on the axlUSDC/USK board as a sell-order.

When the sell-order I just placed (PT) fills, I'll take that $USK and close the borrow, AND have some left over: that's the arb, that's the gain, and it's all from OTHER PEOPLE's MONEY!

Suh-WEET! 🎉

I'll report that out when that occurs.

... some time later

HA! The opposite happened: the BUY order filled, completing an $axlUSDC borrow against $KUJI (one of them)!

SO!

• I collect the order
• I repay the borrow

• I lend the remainder (smol tho' it be) to Ghost

• I ...

... well, I get on with my life. 😊

ROI: 1%, annualized to 847% APY

Raison d'être

Two things to the 'why' I do the above.

1. Why do I repay the borrow, if I'm just going to borrow the same amount and do the same thing, all over again?

Two reasons:

1. It brings that borrow to closure
2. It resets any borrowed interest

2. Why do I lend that minuscule amount of $axlUSDC to Ghost?

I'm treating Ghost as my bag-repository, so the bags I accumulate go to Ghost lend, growing over time as x-tokens (when all the markets open). 

I deposit that smol amount of $axlUSDC to show my bag growing over time.