- Aave https://aave.com/
- 1x https://1x.ag/#/
- Loanscan.io https://loanscan.io/
- BlockFi (borrowing and lending) https://blockfi.com/
- Marble https://github.com/marbleprotocol/flash-lending
- Lendf.me https://www.lendf.me/
Trading cheat sheets
- DEFI tutorials https://defitutorials.substack.com/
- Margin trading on dYdX exchange https://defitutorials.substack.com/p/margin-trading-using-dydx-exchange
- How to arbitrage on DEFI https://www.theblockcrypto.com/post/45750/exploring-defi-trading-strategies-arbitrage-in-defi
- Liquidation risk: Sudden price swings wipe out leverage https://medium.com/defi-saver/automatic-cdp-protection-faux-pas-analysis-updates-in-place-and-next-steps-e238e0d3114
- Smart contract hacks: Smart contracts have bugs that can be exploited https://consensys.github.io/smart-contract-best-practices/known_attacks/
- Structural risks: DEFI products aren't fully decentralized, making them liable to insider exploits https://www.theblockcrypto.com/linked/28748/synthetix-suffers-oracle-attack-potentially-loo>
- Gas spend: Excessive gas prices can make trades unprofitable
- Flash attacks: Capital intensive attacks using flash loans https://medium.com/dragonfly-research/flash-loans-why-flash-attacks-will-be-the-new-normal-5144e23ac75a
- DEFI score: Open source Consensys tool that allows users to evaluate code and perform risk assessment on DEFI products https://media.consensys.net/introducing-the-defi-score-an-open-source-m>
- Smart contract insurance https://nexusmutual.io/
Interest rate arbitrage
MKR (simplified) does the following:
Allows users to deposit ETH as collateral and then take out loans relative to that collateral (max loan = collateral/ 1.5). The collateral is released when the loan is repaid.
This is called a CDP (collateralized debt position) and is equivalent to opening a bank account with MKR. Users deposit ETH in exchange for the ability to print DAI with interest (loans) and earn interest on savings.
The MKR interest rate is called the "Stability fee" and it is currently 0, i.e. I can borrow money without incuring cost, and can't make any money on saving.
However, interest rates differ across different DEFI platforms which gives the potential for arbitrage (see: https://loanscan.io/).
For example you can use borrowed DAI to give loans on other platforms for interest (e.g. interest rate is 0.00% on MKR but 4.42% on Compound).
You can also:
- Lend DAI and borrow ETH
- Use the borrowed ETH to open a new CDP with MKR
- Lend the new DAI and borrow more ETH
- Repeat and earn interest rate spread when (DAI lending rate > ETH funding rate + MKR CDP stability rate)
There are some existing bots that do this, see: https://github.com/makerdao/simple-arbitrage-keeper and https://developer.makerdao.com/keepers/ (I'm sure there are many more). There are also very low tech ways to use this to make small money:
- Take out loans when ETH/USD price is low, pay back when ETH/USD is high (e.g. deposit 1 ETH collateral, take out 500 DAI, trade for 0.5 ETH. Market moons, repay 500 DAI for 0.25 ETH, get collaterol back and earn 0.25 overall). This could probably be automated on smaller price movements as well.
Another thing this is good for is getting through bear market crashes without cashing out crypto, because you can use your existing crypto to generate DAI and pay it back when the market recovers.
- DeFi pulse DeFi ecosystem tracker
- DAI stats DAI analysis
- BTC on Ethereum All BTC tokens on ETH
- Debank Ranking More graphs
- Etherscan Blockchain explorer
- Coin Gecko Price explorer
- Prediction explorer COMP/ BAL calculator and DEX usage
- Flippening Index Ethereum vs bitcoin
- Staking Rewards Simple yield calculator