Overview of Stablecoin Yield Strategies: Diversified Options and Risk Management

Recently, the US dollar index has been running at a high level, putting pressure on risk assets to decline, making the holding of US dollar assets a more stable choice. Many top DeFi projects are also actively utilizing idle US dollar assets to generate returns. This article will focus on several notable stablecoin yield strategies to provide investors with diversified options.

Convex: USDD+3Crv Strategy

USDD is an over-collateralized stablecoin managed by the TRON DAO Reserve. As of October 27, the issuance of USDD is 725 million, with collateral value of 2.23 billion USD and a collateralization rate of over 300%. Among them, the USDC collateral amounts to 990 million, significantly exceeding the issuance of USDD, indicating a lower risk coefficient.

The annualized yield of the USDD+3Crv pool on the Convex platform is 19.66%, while the APR for the USDD+FRAXBP pool is even higher at 21.18%. In operation, users can first provide liquidity on Curve to obtain LP tokens, and then stake them on Convex to earn rewards.

It is worth mentioning that in the Tron ecosystem, the application scenarios of USDD are more extensive. For example, the annualized yield of the USDD-USDT trading pair on the SUN.io platform can reach up to 41.9% (requires locking and staking SUN).

Canto: USDT+NOTE Strategy

Canto is an EVM-compatible DeFi public chain in the Cosmos ecosystem, providing functions such as DEX, lending, and the stablecoin NOTE. Currently, the total locked value of Canto is approximately 100 million dollars.

The lending module of Canto shows that the APR for NOTE/USDT LP is 32.14%, and the APR for NOTE/USDC LP is 29.47%. NOTE is an over-collateralized stablecoin in the Canto ecosystem, and liquidation will not occur when the collateral is USDC and USDT.

Operation suggestion: You can use part of your USDT as collateral to mint NOTE, then use NOTE and the remaining USDT to provide liquidity, and finally stake the LP tokens in the lending module.

However, the cross-chain operations of Canto are relatively complex and require multiple steps to complete asset entry and exit.

Velodrome: sUSD+LUSD Strategy

Velodrome is a decentralized exchange on Optimism, derived from Andre Cronje's Solidly developed on Fantom. Currently, Velodrome's TVL has reached $82 million, performing excellently within the Optimism ecosystem.

sUSD and LUSD come from the Synthetix and Liquity projects respectively, both of which have high security. Currently, the liquidity mining APR for the sUSD/LUSD trading pair in Velodrome is 16.12%.

Helio: HAY+BUSD Strategy

Helio Protocol is a liquidity staking and lending protocol on the BNB chain that allows users to over-collateralize and borrow its stablecoin HAY. Currently, Helio's TVL is $92 million.

PancakeSwap has added a StableSwap exchange entry for HAY and BUSD, reflecting the market recognition of HAY. Investors can provide HAY/BUSD liquidity on PancakeSwap and then stake the LP tokens in Helio, with the current APR at 19.77%.

Wombat Exchange Ecosystem: Various Stablecoin Strategies

Wombat Exchange is a stablecoin trading platform on the BNB chain, featuring low slippage and shared liquidity. The APRs for USDC, USDT, DAI, and BUSD in its Main Pool are 11.44%, 11.14%, 10.85%, and 7.57% respectively (including WOM staking and veWOM acceleration).

Applications similar to Convex have emerged around Wombat, such as Wombex Finance and Magpie, providing users with higher yields. Wombex currently has a TVL of approximately $89.49 million, with deposit APRs for major stablecoins ranging from 12.71% to 17.16%. Magpie's TVL is $25.90 million, with an APR range of 9.65% to 14.52%.

Finally, it is important to emphasize that the cryptocurrency market carries high risks and security incidents are frequent. Investors should fully understand the risks, diversify their assets, and remember "DYOR" (Do Your Own Research).