3.5x Leveraged cbETH:ETH Yields - Aave

Visit Discover to deposit into this strategy and automate your yields!

➡️ Strategy Deposit Link

Visit Studio to copy/fork and tweak this strategy!

➡️ Strategy Builder Link

Description

https://studio.factor.fi/?hash=0xdc9fdad0b832264cf46438b2ea97098cae0de1d871de5c72264b79f58de64873

This vault creates 3.5x leveraged cbETH:ETH position that earns 1x cbETH liquid staking yields plus an additional 2.5x interest differential between cbETH yields and WETH borrow costs.

Deposited cbETH is supplied to Aave enabling the strategy to borrow WETH which is then swapped for more cbETH. This process is repeated to get up to 3.5x leverage which provides a 5% liquidation buffer.

+ cbETH liquid staking yields

- ETH borrow interest

Strategy

Main strategy

1. Flash loan 2.5x the deposited $cbETH amount

2. Lend all $cbETH - Aave

3. Borrow $ETH to cover flash loan

4. Swap borrowed $ETH → $cbETH

Exit Strategy

1. Flash loan $ETH

2. Repay $ETH debt - Aave

3. Withdraw $cbETH collateral - Aave

4. Swap $cbETH → $ETH

Exit Strategy

Factor Discover also enables Depositors to permissionlessly withdraw from any strategy at anytime via an Exit Strategy.

Visit our Exit Strategy explainer to see how Factor Studio strategies can maximize returns while ensuring truly permissionless withdrawals.

Protocol Parameters

Aave

• ~0.11% cbETH Supply Interest

• ~2.43% WETH Borrow Interest

• 75% cbETH Max LTV

Coinbase

• ~3.09% cbETH Liquid Staking Yields

OpenOcean

• 0.1% Max Slippage Config

Strategy Performance Conditions

Profit

• cbETH continuously increases in value vs WETH.

• WETH borrow cost is less than cbETH liquid staking yields across Aave

Loss

• cbETH depegs from ETH.

• cbETH liquid staking yields falls below WETH borrow costs.

Calculation Template

Create Your Own Strategies!

Create a copy of the sheet below and tweak it to create your own personalized strategy.

https://docs.google.com/spreadsheets/d/1SRg9rk_WcOrDr7x18f3mNVZf2_D7Uw1pMiHASvSnZ-Y/edit?usp=sharing

Estimated Returns

https://docs.google.com/spreadsheets/d/11pOG2i3EUpRau5XJcDa9lL1FxGJSjYqhD6QUSON8Ja4/edit?usp=sharing