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RE: Can yETH bring the Ethereum bull back?

in HODL • 4 years ago

@tipu curate

Very interesting post (as usual)

yETH vault strategy has 200% collateralization to acquire MakeroDao’s DAI. It seems to be justified to me but obviously the strategy has a lot of risks involved. A massive price fall of ETH may lead to the liquidation of the vault.

Do you mean they have 1 ETH for 2ETH worth of DAI? If so, indeed ETH needs to not lose 40-505 ! Quite amazing topic. Too bad ETH fees are a pain in the ass...

The sell pressure on CRV is also quite a "side-effect", this is the main issue for all these farming protocols imho. Who buys the earned token in the long run?

Definitely not me 😂

4 years ago in HODL by
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     4 years ago  

    Thanks for your kind attention. If they have 2 ETH, they'll borrow 1 ETH worth of DAI by making 2 ETH collateral. But it looks safe to some extent. Obviously, if ETH price drops drastically, there will be the liquidation of the vault.

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       4 years ago  

      Okay, then they only use 50% of deposit as collateral. Quite safe with ETH asset indeed 😄

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