HARMONY: "This is how I Defira"

Um. 

@Defiraverse yields: SEVEN HUNDRED THIRTY-ONE DOLLARS?!?!

Well, okay, then! 

So, first of all: hi, everybody.

Next: people have different strategies, including hedge, and different views on $sFIRA.

That's fine.

But I'm talking my strategy here, which is: lean into what works. It's extremely aggressive, and misses, too, but when it hits...

O
Boy!

So, what is my strategy with @Defiraverse, then?

1. Collect yields,
2. Farm yields in LPs and stakes (split evenly)
3. $sFIRA is more real than $FIRA for a yield-farmer like moiself. Stake 50% infinitely, unseal the other 50%.
4. Measure. Every. Day. (Spreadsheets! YAY!)

Some convert $FIRA to stables as a hedge.

That's fine.

Some view $sFIRA as valueless.

That's fine.

You do what works for you. I'm showing what I do, and what works for me. I did this in @DefiKingdoms and I'm up 1500% there. Still.

But you do you.

Back to it. We've collected the yields. Where to put them? Looking at farming, we see basically two tiers of LP yields:

1. Green: $FIRA & $TRANQ farms above 1000% 
2. Everything else (stables and blue-chips)

I concentrate on tier 1: more bang, and that what the yields are

So, okay, we have the farms where the yields will go. How will they go? My approach:

$TRANQ split three ways evenly on:

• FIRA-TRANQ LP  
• TRANQ-WONE LP (n.b.: we add 96 $ONE / $12 to our invested amount) 
• @tranquil_fi locked $TRANQ fees stake

Let's do that right now.

Why do I do $TRANQ first? Because it settles the $FIRA-balance. With the remainder of the $FIRA, I split it 50 / 50 between staking and the $FIRA - $WONE LP.

So $FIRA: feeding the $FIRA - $WONE LP means we infuse 656 $ONE / $85, which we add to our investment balance.

Okay, we've staked our $FIRA, right? Or: please remember to stake / farm the LPs (let's do that now), and collect the $sFIRA rewards from the (single) $FIRA stake, as well.

We've reinvested our $TRANQ and $FIRA, that leaves us with $sFIRA.

• First, claim the yields. 
• Then, evenly split $sFIRA between unsealing and staking.

This completes our distribution work.

Now let's run our reports! REPORTS! XCĪT!

Admit it: you love my reports. 😎

Asset Allocation for @Defiraverse, 2022-03-09:

• $FIRA stake is slowly coming into its own, like it should 
• $sFIRA stake is beginning to dominate, massively, like it should with this strategy 
• And the LPs provide the gas for this 'feeding frenzy'-fire, like they ought

• note on how I use the term 'feeding frenzy.' 

"Wen @Defiraverse self-funded, ser?"-experiment

Day 12

adjustment investment: $2,308.03

today's yields: $747.20

total yield: $1,604.58

Amount remaining to self-fund: $703.45

We've now fallen to ~$700 remaining of the (adjusted) $2300 investment.

TERRA: Mirror Delta Neutral Farming maintenance

Oh, don't mind me! I'm just collecting 77 $UST from a $mNKE short-sale unlock, is all.

@mirror_protocol: both passive, and, in this case, active generation of income.

The markets have seen a downturn, and that downturn has freed up 44 $aUST collateral across the @mirror_protocol board.

I created a spreadsheet which told me which mirrored assets were highest-yielding, and how much to invest in each.

Today I'm expanding $mNIO and $mMSFT.

So, okay. Let's start with $mNIO:

1. I added collateral to the @mirror_protocol short-position, increasing my SHORT to 5 $mNIO

2. I rolled in (*checks spreadsheet) 20 $UST to @SpecProtocol $mNIO-UST vault, increasing the $mNIO to 5, there, too: covering the short.

... and finish up with $mMSFT:

1. I added collateral to the @mirror_protocol $mMSFT short, increasing it to 0.37.

2. I rolled in ~20 UST to the @SpecProtocol $mMSFT-UST vault to cover the short.

Do you see what's going on here? Because of the market downturn and a short-sale I made 2 weeks ago, I'm MAKING MONEY, 120 $UST, in fact, on a market downturn.

@mirror_protocol makes me money on a market downturn. What other protocol does that?

Let that sink in.

But @mirror_protocol supremacy comes from that you make both passive income in yields, and active income in short-sales, case in point: I will be unlocking income in 2 weeks from the short-sales of $mNIO and $mMSFT because I expanded my positions in both these assets.

Whales and the Mirror Protocol: a case-study of self-determination

To be a Whale in #cryptocurrency doesn't mean you get your way. Case in point: a whale has floated two proposals on @mirror_protocol to lower collateral ratio to 110% for $mIAU and $mSLV: https://mirrorprotocol.app/#/gov 

Why? What is the angle here?

Gold and Silver are the most stable securities in the world. 

Shorting them is well-nigh guaranteed to be safe. And you make yields on shorted assets on @mirror_protocol.

Two advantages then:

1. yields 
2. capital preservation

If I'm a whale, and here's the material point: if I'm anybody, I want to put my investment with the highest return. With a 200% / 150% collateral bracket, for each $2 I put in, only $1 gets the (verra smol) yield. That must be so frustrating, given such a stable position!

So, I, this whale (n.b.: I'm not the whale, btw), put in proposals to rectify this issue. Let's adjust the collaterals down to reasonable levels. And the voters, to a T, agree, but then, what happens?

An even bigger whale, maybe Terra Labs, vetos them. Singlehandedly.

Further, look at the votes on the previous (vetoed) proposals. We, the community, OVERWHELMINGLY voted FOR these proposals.

https://mirrorprotocol.app/#/gov/poll/247

https://mirrorprotocol.app/#/gov/poll/248

It was one, and only one, vetoer that killed these proposal dead, with 4M $MIR. 

Guess.

Who.

What's happening here?

"Is @mirror_protocol decentralized?"

This is the question before us.

We have one whale voting in his self-interest, but fielding a proposal acceptable to the community that gets shut down by centralized control.

We're seeing how 'decentralization' plays out in real time,

Now, I'm not painting this whale as the 'Good Guy' and Terr- oops, the 4M $MIR-owner as the 'Bad Guy,' but I am addressing the question that affects me, and you, and the protocol, and Terra.

"Is @mirror_protocol decentralized?"

These very one-sided vetoes say: no.

Why is this a problem? For everyone?

Terra made a very public statement in its defense a US Gov't suit from the SEC stating it exercises NO control over @mirror_protocol: "@mirror_protocol is decentralized."

The US Gov't can now look at these vetoes and argue otherwise.

So, that's a problem for Terra, but it's a much bigger problem for us, the little guy, not the whale, for us.

Why?

What do our votes mean? We voted FOR. Almost to a person. Overwhelmingly.

The protocol's community voted FOR.

And was shut down.

That wasn't nice.

But if you know me, you know I don't do nice. I do what works, and what works, for me, is that if @mirror_protocol is decentralized, then ALLOW the community to chart the course of the protocol, whatever that course is.

Will we make mistakes? Yes, but how big a mistake is setting collateral for $mIAU and $mSLV? Enough of a mistake to shut down the vote? I don't think so. I think centralized interference is causing more harm than good, to all parties, in this case, and in most cases.

Here's my request, @terra_money. Let decentralization play out. We make a mistake with a vote? LET US make that mistake, and LET US correct it. The dangers of central intervention are clear, AND the disadvantages of decentralization are well-know.

So: let this play out.

Or, if you don't want the community to vote, nor have a say in the vote, stop pretending @mirror_protocol is decentralized, and just lay down the law. Masquerading 'decentralization' makes our votes meaningless and disempowers the community.

And isn't the vision of Terra self-determination via a decentralized currency?

@mirror_protocol is an experiment in self-determination. And this, right here, right now, is what that looks like.

HARMONY: VIPER Nests

Here is another example of a 'feeding frenzy' of yield-farms.

On @VenomDAO:

1. The $wsWAGMI nest produces $VIPER on https://viper.exchange/#/staking/single
2. Convert the $VIPER to $xVIPER on https://viper.exchange/#/staking/viperPit
3. Feed the $xVIPER to the nest that yields $wsWAGMI

Lather. Rinse. Repeat.

HARMONY: UNITE!

No, really: Harmony unite.fi. Let's talk.

So here's the 'something interesting' I hinted at yesterday: @finance_unite.

I invested $100 into $USHARE which I staked.

I got $1.59 in yield today, and most days, thereabouts.

That's 1.5% ... per day.

And we're not half-done here, folks.

So, here's the $UNITE - $ONE LP. I have $344 invested in that (adding a bit here and there over time), so that makes the yield a bit less that 1%

... per day.

... every day.

... since day 1.

And do you see the feeding frenzy of yields here? Let me explain.

How does the feeding frenzy work?

• I collect the $UNITE yield from the $USHARE stake
• I put the $UNITE yield into the $UNITE- $ONE LP
• that LP produces $USHARE

You with me?

• I stake the $USHARE yield from the LP.

The yield produces yield produces yield. 😍 🥰

HARMONY: $stONE. SWAP or BURN?

 Let's say you make a good arb on the @SushiSwap $ONE -> $stONE arb: 

Wat do?

1. put it into the 'infinite $ONE well' is my standard answer.

but:

2. SWAP it back from $stONE to $ONE for an instant gain; a real arb. You make less $ONE, but faster.

A conundrum.

HARMONY: $ONE -> $stONE Arbitrage

Okay, let's explore the $ONE -> $stONE arbitration.

Is there one? How do you know? Then: what do you do if there is one?

So. Step one. Collect your $ONE from your 'infinite $ONE well' on @tranquil_fi. (I'll explain the term later.)

Next, let's understand $stONE. Go to @tranquil_fi $stONE page. You see it has a multiplier. What does this mean?

It means $stONE is worth 1.015, or whatever, times more than $ONE. Always, and the multiplier ALWAYS increases.

Remember this: $stONE is MORE than $ONE

Why is it important that $stONE is worth more than $ONE (ALWAYS)?

Because, sometimes, not all the time, but sometimes, the $ONE - $stONE peg goes kurfluffernutters, and you can swap, say, 100 $ONE for 101 or 102 $stONE.

"nbd," you say. Maybe. But let me explain.

To explain, let's open the 'Unstake'-tab on the $stONE @tranquil_fi page, or what I call the 'Burn'-tab ('burning' is a more general technique than unstaking).

What happens here is you burn $stONE to $ONE? This process takes about 7 days.

That's a GUARANTEED trade, folks

Okay, so, you've got the idea, right? You have $ONE, if you can trade that for MORE $stONE, you win.

That's called arbitration (well, one kind of arbitration), and it's as simple as that, so what remains is:

1. The Mechanics (and Mike, too) lol
2. What if there's no arb?

The Mechanics

How to see if there's an arb? Easy-peasy! Go to @SushiSwap and (simulate) a swap from $ONE to $stONE. If you get more $stONE out, you have the arb. SWAP! SWAP NOW! SWAP FOR ALL YOUR WORTH! HURRY!

I'm not kidding. Arbs can disappear in an instant.

Is there an arb now? Yes, 1014 $ONE -> 1015 $stONE. It's a little arb. A little, tiny arb. But do I take it?

YES!

In a heartbeat. Why? because usually the swap is something like 1000 $ONE -> 995ish $stONE. 

You BET I'm taking this tiny arb. It's WAY better than negative

I can hear your disappointment: "All that work for 1 $ONE? That's 0.1%!"

No, it's not. Remember the multiplier? When you burn the $stONE to $ONE, you get back MORE $ONE!

How much more? For this trade:

81% annualized more.

Arbitrage computation.

Let's do this burn! Go to $stONE page on @tranquil_fi and open the 'Unstake' tab. Burn ('unstake') all 1015 $stONE, and you see the output: 1030.68 $ONE in 7(ish) days, or an 81% annualized gain.

Two words:

Dude. 😳

That's an 81% gain of $ONE yield, GUARANTEED.

Let's check our burn. Go to the 'Claim'-tab. And, behold, you see what I call the 'infinite $ONE well':

I have a rotating pipeline of $ONE to be claimed, which I swap, then burn, then put right back on the pipeline.

I'm making 80%+ annualized gain on $ONE, infinitely 😎

The No-Arb Path

Okay, all the above is the 'Happy Path': when there's an arb on @SushiSwap. But what if there isn't an arb? Do we cry? (yes) Do we stomp our feet and throw tantrums? (yes)

But we can do something much more constructive, given we've set up ourselves for this eventuality.

This is the 'Sad Path': when there is no $ONE -> $stONE arb on @SushiSwap. To prepare for this eventuality, I've established $ONE and $stONE collateral positions on @tranquil_fi marketplace.

Why?

1. Why not? 🤪 but seriously:
2. Feeding the infinite $ONE well pipeline

With these position, when there's no arb, I make a daily call: do I borrow $stONE (yes: they're paying me to do so), or do I take $stONE out of collateral? (I've done that, too).

Either way (borrow or reduce collateral), I grab 1000 $stONE, and 7-day burn that to $ONE.

Why burn $stONE to $ONE, when $stONE is always worth more?

1. The arbitrage, when it happens, is $ONE -> $stONE. I've NEVER seen $stONE -> $ONE arbitrage. I ALWAYS want $ONE at the ready to arb, AND they both collateralize at the same rate; and,
2. If there IS no arb, I can use my $ONE bag as collateral to BORROW $stONE (which they pay in NET POSITIVE yields for me to borrow!) if I don't have $stONE collateral that I'm willing to part with.

A $ONE bag has no down-side.

Post script: I mentioned leverage, obliquely, a couple of times. You don't have to borrow $stONE to make this work. Ever. Just wait for the arb and accumulate an $stONE bag in reserve. You do you. I do leverage, and I'll cover leverage on @tranquil_fi in a future post.

Post-post script: alternatively, you can SWAP back to $ONE for an instant gain, albeit less. A conundrum.