EVMOS DeFi yield farming kicks off in earnest.

in LeoFinance5 months ago

The DeFi sector on Evmos has had a fairly tough run. Early on their were delays in the chain launch, followed by a lengthy downtime before relaunch following a bug. The re-launch followed, and it seemed like the troubles were over. Steadily, DeFi projects started to grow, and the next issue appeared. Attracting capital was difficult, mainly due to the fact that just simple staking for EVMOS carried such a high yield, that enticing people into Liquidity Pools with their different risk profile was a challenge.

Still, liquidity did start to build, most notably on Diffusion (currently the flagship DeFi platform on EVMOS, a fork of Uniswap v2). Then the next major blow happened. The popular Nomad bridge was exploited (post by @idiosyncratic1) and hundreds of millions of dollars were drained from the bridge. DeFi on Evmos has been developing with a number of bridge options, but Nomad had been the most used and popular.

But now, DeFi is back...

diff yields.png

Source: Diffusion

EVMOS rewards starting.

A significant amount of EVMOS tokens that remained unclaimed at the end of the EVMOS airdrop, were moved to a treasury fund. A recent governance vote from EVMOS stakers has approved the commencement of using these funds to incentivize Dex liquidity, with Diffusion first in line. Diffusions farms have already carried some incentives in the form of DIFF (their native token). However, EVMOS is a much more valuable and desired token, and the addition of significant amounts as farming rewards will bring fresh liquidity in and kickstart DeFi growth.

This was the proposal that has kicked the APR's into overdrive. 2 million EVMOS has been committed to fund farming rewards on Diffusion for the next 3 months.

The EVMOS incentives will go towards attracting liquidity for EVMOS pairs with ATOM, WETH, WBTC, OSMO, JUNO, DIFF, and USDC pools.

2mil EVMOS is less than 1.5% of our available funds, and covers an entire DEX including interchain assets on Evmos.

Quotes are from the above linked gov prop.

As you can see, the amount of tokens released is a very small portion of the treasury fund. This fund has 142 million EVMOS at its disposal. (Worth a rather significant $230 million at current prices). We can expect to see many more incentives and yield opportunities emerge on EVMOS, and during a bear market this could attract significant growth in TVL and demand for the EVMOS token.

There is also a much smaller spend approved for Kinesis Labs, a dApp focused on stablecoins. It will be interesting to see the impact of EVMOS rewards on liquidity here also.

690% APR anyone??

Do Your Own Research, Not Financial Advice of course.

Adding liquidity on Diffusion generally required bridged assets. There are a couple farms for IBC tokens (once you convert them to an ERC token), however ETH bridged tokens are dominant. Bridges are obviously high risk.

The plus side for this yield is that it is not mainly in a useless DeFi farming token. It is being provided in the chains native token, EVMOS, and there are a number of established and upcoming uses for EVMOS. It is a lower risk play to yield farm for a quality token, as opposed to a purely reward token like DIFF. On the other hand, bridges. Need I say more?

ceWETH_EVMOS farm.png

As you can see, my initial position is a whopping $12.60. 🤣 Whale Alert 🐳

But seriously, I have absolutely no free capital to add. However, I do have around 2.7 EVMOS per day in staking rewards, that will get added to this pool. I have no doubt that the yield will decline rapidly, as the pools fill up with farmers chasing gains. However, I am here for it, and will slowly build a position over time.

Are you searching for a high yield in the current market? Maybe it will be worth having a play on EVMOS. NFA, DYOR.

Thanks for reading,


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So, is evmos an even chain like Polygon?

I am also at a whopping $12 something but $6 something :-D and have also some EVMOS to use every day from staking... Will use it all.

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