WBTC Base Switch On rETH For ETH & USDC Yields
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An ETH rotation play which earns USD yields on rETH by switching the base asset from USD → WBTC. This strategy profits when ETH outperforms WBTC and is profitable as long as the generated USDC lending interest is greater than rETH to WBTC underperformance.
+ USDC Lending Interest
+ rETH Liquid Staking Yields
+ rETH Lending Interest
- WBTC Borrow Interest
Flash loan $rETH equivalent to 100% USDC value
Lend $rETH - Aave
Lend $USDC - Aave
Borrow $WBTC
100% of initial $USD value
Swap all $WBTC → $rETH
Exit Strategy
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WETH, and by extension rETH, outperforms WBTC for the period of the deposit.
USDC supply interest and rETH liquid staking yields are greater than WBTC borrow costs.
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The profitability of this strategy depends on the performance of ETH relative to WBTC. Aside from potential trading returns, the strategy also earns a net yield of ~6.7% (as of 06/03/25) that comprises of:
USDC lending interest
rETH liquid staking yields
WBTC borrow costs
