DeFi 2.0 Real Yield Strategy Using 0VIX Protocol

Hey, guys! Today, let’s discuss the concept of earning real yield with your assets using the 0vix Protocol, a DeFi 2.0 money market enhanced with Ve-Tokenomics built on Polygon.

It’s platform allows users to lend and borrow selected digital assets without the need to rely on a central power.

The 0vix protocol is non-custodial, meaning that users can deposit and withdraw their digital assets at any time.

In terms of security, the 0vix protocol has been audited by trusted security firms and constantly undergoes security audits to help keep users funds ‘safu’(In the language of crypto lovers, which means safe)

Currently, it has over $9+Million in it’s Total Value Locked and it’s gradually gaining adoption in the heart of DeFi lovers and Degen alike.

But before we dive in, let’s understand the concept of Real Yield.

Real yield is the share of a protocols Revenue, which is distributed in an asset like ETH or stables and can be earned by users who are staking their governance token, farming or providing Liquidity.

Let’s dive in!

• First, we need to decide on the asset to use. In this case, it will be 50 Matic, which we will deposit on the OVIX Protocol and borrow 20 DAI against the Matic
• Next, go to the supply part of the platform, deposit your 50 Matic, and turn on the collateral
• Go to the borrowing session and take out 20 DAI.
• Next, head over to the Gains network and deposit your 20 DAI into the DAI vault.

Now we can start earning real yields, A percentage of the platform’s revenue in the form of extra DAI.

By providing our borrowed DAI as liquidity for traders on the platform, we earn more DAI from fees generated by those users trading on its decentralized leverage trading platform based on the platform’s trade volume

Check out this video for Directions;

Yield farming strategy with 0vix protocol

Now, let’s talk about the rewards and risks we can encounter from using this strategy.

• By supplying Matic on the 0vix protocol, we earn a variable APR, which is the annual percentage return on our deposit.
• We start pre-mining $vix both from our lending and borrowing position.
  “pre-mining is the creation of a cryptocurrency before it’s launched to the public”
• We keep our long exposure on our Matic and earn pre-mining rewards on the 50 Matic and 20 DAI
• We make more money from the borrowed DAI by depositing them in the Gains DAI vault to earn a share of the trading fees generated by Gains users

However, the drawback involved in this is that we run a risk of liquidation if the total price of our Matic decreases below $27

Our loan can be liquidated when our health factor drops below 1 and the Matic deposit decreases in value against our DAI.

Our collateral will be sold and used to repay the loan.

To increase or maintain our health factors, we can either repay the DAI loan or deposit more MATIC.

Why Gains Network?
benefits

Gains Network is a protocol that has developed a user-friendly and decentralized leveraged trading platform on Polygon

• Gains Network is a decentralized ecosystem of products built on Polygon that currently has over $12m in total trade fees of DAI and over $95m in the trade volume of DAI in the last 24 hours.
• We earn the leveraged trading fees of 12.46% APR on our borrowed DAI projected from the last 7 days to a year and When the yield is compounded daily, becomes 13% APY

drawbacks

• The staked DAI can only be withdrawn at a rate of 25% of your maximum holdings (from the last time you staked) every 24 hours.
• Stakers in the vault are rewarded highly as users who stake will bear the risk of a loss if the DAI vault becomes undercollateralized and does not return to sufficient collateralization.

However, the protocol claims no stake has ever experienced a loss since the DAI vault was introduced on December 20, 2021.

Note: every cryptocurrency bears a smart contract risk and none is assumed 100% safe.

I’m not a financial advisor and This post is only meant for educational purposes. Remember to do your own research.

To get started, visit https://app.0vix.com and let the yield farming begin

Official Links:

Website: https://www.0vix.com/

Twitter: https://twitter.com/0vixProtocol

Discord: https://discord.gg/0vix

Telegram: https://t.me/OVIXProtocol