Written By
DeFi Dad
Community Lead

How to Earn Up to 42% APY with Curve and Inverse Finance

June 10, 2021

Disclaimer: This is not financial advice. This is an educational resource that should never be interpreted as an endorsement to buy any digital assets mentioned. Please do your own research and be sure to check the updated APY being earned because rates can go up or down with the price of INV rewards and depending on how diluted the DOLA-3CRV pool becomes.

Inverse Finance and the DOLA Stablecoin

Inverse Finance is a suite of DeFi investing tools created and managed by the Inverse DAO (a decentralized autonomous organization) on the Ethereum blockchain.

  • The Inverse community offers DCA Vaults for dollar-cost-averaging with profits from yield-earning strategies. Essentially, you deposit DAI or USDC and the accrued yield from your stablecoins is used to dollar-cost-average into ETH, WBTC, or YFI every every week.
  • Another Inverse product is called Anchor, a money market and synthetic asset protocol to create more efficient borrowing and lending markets.
  • Lastly, where we'll focus today, is a debt-based stablecoin token called DOLA that tracks the price of the US dollar. DOLA is minted by depositing common Ethereum-based tokens on the Inverse Anchor app so that users can borrow against their collateral. DOLA is the synthetic dollar-pegged token borrowers can choose to receive, and it can even be reused as collateral to borrow other assets on Anchor.

On Anchor, each DOLA represents $1 of collateral that can be used to borrow other assets regardless of DOLA’s market conditions or peg. In this sense, it is similar to DAI by Maker or sUSD by Synthetix.

Bootstrapping liquidity for DOLA with a $1 peg has been key to the success of Inverse's products. To incentivize providing such liquidity for the DOLA token, the Inverse DAO voted twice already to reward those who provide liquidity in the Curve DOLA-3CRV liquidity pool. As a result of such efforts, the DOLA-3CRV liquidity pool in the Curve protocol boasts about $3.57M as of this writing.

Farm Yield for Providing Stablecoin Liquidity with DOLA

The opportunity identified in this Alpha Leak is for those seeking to earn yield on stablecoins in 2 forms: trading fees and issued INV rewards. INV is the governance token behind the Inverse DAO governing the Inverse Finance protocol and their suite of permissionless DeFi products.

The liquidity providers (LPs) in the DOLA-3CRV pool earn a combined estimated 42% APY thanks to multiple yields below. When you can earn multiple yields at once, we call that yield farming, which you can learn more about here if you're new to DeFi.

  • A portion of the fees earned from 0.04% charged per trade in this pool
  • A portion of the INV rewards for those who stake the DOLA-3CRV LP

Length of the Rewards Program

These DOLA rewards recently refreshed and will last about 2 months from the time of this writing through about mid-August 2021.

Fees

There are no fees to deposit/stake Curve LP, just the usual fees paid to the Ethereum network miners to confirm your transaction.

Risks

This opportunity exposes participants to the following major risks:

  • Smart contract risk in Curve and Inverse Finance protocols. Curve is currently covered by DeFi insurer Nexus Mutual but Inverse is not covered and it's unaudited.
  • Systemic risk in nearly all of DeFi due to the interconnected nature of money legos
  • Risk of a stablecoin like DOLA in the pool de-pegging.

How to Earn Up to 42% APY with Curve and Inverse Finance

Here's how to get started farming yield with stablecoins thanks to Curve and Inverse Finance:

  1. Go to this link in Zapper Pools to invest with one of the 4 stablecoins that make up the pool: DAI, USDC, USDT, or Inverse's DOLA. One can start with any one of these or a totally unrelated token and Zapper Pools will auto-swap to the appropriate underlying tokens when you deposit. Specify which token and how much to deposit. Follow the prompts to Approve spending tokens, and then Confirm depositing tokens. These are 2 separate transactions, and once completed, you're officially a liquidity provider (LP) earning a portion of trading fees.
How to Invest in DOLA-3CRV LP with Zapper Pools
  1. Next, go to Zapper Farms and search "DOLA" or click Show Available to Stake to find the Inverse Finance opportunity. Click the green button Stake and follow the prompts to Approve spending your DOLA-3CRV Curve LP tokens, and then Confirm depositing these tokens. These are 2 separate transactions, and once completed, you're officially earning a portion of the of the 750 INV per month for a duration of up to 2 months (1500 INV total), expected to end in mid-August 2021 since launching the program about June 16-17th, 2021.
  2. Now, you can track your earned INV rewards on your Zapper dashboard like you see below or under Active Farms in Zapper Farms.
Tracking DOLA-3CRV LP on Zapper by Inverse Finance
Track the staked / deposited DOLA-3CRV LP balance under Staked
Tracking INV Rewards from Inverse Finance on Zapper
Track earned INV rewards under Yield Farming
  1. Lastly, return to Active Farms in Zapper Farms to Claim INV rewards whenever you liked, but ideally before the program ends in mid-August 2021. It will require 1 MetaMask transaction to claim INV rewards.
How to Claim INV with Zapper from Inverse Finance
Please note I was using a demo wallet which is why you see the green up top

You're done! Your deposited Curve pool tokens will continue to accrue the underlying trading fees while earning INV through the 2-month Inverse rewards program.

Get started in the DOLA-3CRV pool!
Invest liquidity with any token

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