PIP40: Yield Farming - autoharvesting and reinvesting PIE

PIP
#1

Might be related to PIP 11: Yield Farming++

Background

Currently, to do yield farming it takes loads of transactions.

I will use $SUSHI as an example, the same is true for $UNI.

5 transactions to get in:

  • get the $SUSHI by sending ETH
  • approve $SUSHI
  • provide liquidity, receive LP (liquidity provider) tokens
  • approve LP
  • stake LP

2 or more transactions to get out:

  • unstake LP (sometimes need to approve LP again)
  • withdraw liquidity (depending on the platform can get proportional or single asset)

Goal

I would like to minimize the number of transactions.

I would like to automatically harvest and reinvest the profits, just like https://yearn.finance

Asset allocation?

There are some notable dashboards

Ideally, a couple of different farms to minimize the risk of smart contracts and rug pulling.

  1. $SUSHI / ETH on SushiSwap comes to mind as a sure-fire candidate for the spot number 1
  2. TBDā€¦
  3. TBDā€¦
  4. TBDā€¦

This is because I believe in the power of dominant networks. Bitcoin: dominant monetary network, Ethereum: dominant smart contracts network, SushiSwap: one of the two dominant swapping networks (the other one is Uniswap but not yielding $UNI tokens anymore)

The overall allocation of assets would be 50% ETH and the remainder 50% of various tokensā€¦

Next steps :rocket:

Reality check: does it make sense?

Maybe it already exists, is already proposed, discussed, someone else is doing it alreadyā€¦

Once there is some positive feedback we can evaluate what is the optimal flow, allocation, ratios.

If the idea is crap: even better, scrape it, fall forward.

5 Likes
#2

Hi @mars

Iā€™m not completely sure I understand.
You want to create an Indexe containing Vaults ?

Ex: Take all yVaults and create a Pie ?

Or do you want PIEDAO to create vaults ?

Basically you want a more aggressive vesion of the YPIE (https://pools.piedao.org/#/pie/0x17525e4f4af59fbc29551bc4ece6ab60ed49ce31) .

Instead of ā€œnative stakingā€ you want to optimise yield ?

#3

Some discussion here: https://discord.com/channels/544810647683072000/544811126836428800/794580751622340638

My proposal is in response to YPIE: https://pools.piedao.org/#/pie/0x17525e4f4af59fbc29551bc4ece6ab60ed49ce31

Why lending at 4% APY when can yield farming at 10x and more?

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Yield farming underlying assets, as opposed to just ā€œlendingā€.

#4

Hey @mars if I got it correctly the major constraint I see is that you should also contribute the 50% ETH side to yield farm those tokens. So that would be slighlty different than having a productive index like YPIE, since would imply wrapping the same with ETH, and providing reward only to LP of this new ā€˜YPIE/ETHā€™ product

#5

I actually do not see it as a problem.

I see it as ā€œit is what it isā€.

Most of the guys here are bullish on ETH, holding ETH is not a problem. The problem that I see is diversifying into ā€œshitcoinsā€ but if there is 200-300% APR with harvesting and reinvesting I can actually take the risk.

Criteria

Criteria when choosing yield farming tokens

  • Risk reward ratio
  • Audits
  • Trust (donā€™t trust, verify)
  • Brand
  • Community
  • Number go up, economic validity of a token
  • Diversification (different platforms, not everything on a single one)

Suggested farming pairs pairs

  • Sushi - biggest network
  • Badger - fair launch
  • Dough - meta dog fooding
  • Doki - simply because I like their design: https://dokidoki.finance/
  • Harvest - cool brand
  • 1 Inch - cool airdrop
  • Balancer - active use

Personal view

I think I would comfortably put 10-20% of my crypto portfolio in such a pie.

  • High exposure to ETH - good
  • High yielding farms - good
  • Harvesting and automation - good
  • Saving gas fees - good
  • Diversification - good

Random

There should be some EIP ERC for harvest() or deposit()? Would make interacting with all the farms easier

1 Like
#6

I would also throw a % of my holdings on such a pie, though maybe less than 10%. Only question for me is, what is the strong USP that differentiates such a pie from all the other yield farming platforms? Are we just saving gas by pooling together to do the transactions? Isnā€™t this already done elsewhere? Is the DAO going to again be subsidizing gas?

#7

USP benefits:

  • diversification
  • auto-harvesting
  • auto-compounding

Who else is doing it?

Massively inspired by https://yearn.finance/vaults (single asset only)

TODO: do you know a product that does it for yield farming? 99% NO, PieDAO is at the forefront of innovation :rocket:

Gas subsidy?

Not necessarily. The harvested profits can pay for gas.

Profit allocation policy

For example SUSHI / WETH pair, the reward is in SUSHI

Suggested breakdown:

  • 90% to be reinvested (as SUSHI / WETH LP)
  • 5% to DAO treasury as ETH
  • 3% subsidizing gas fees as ETH
  • 1% Ross Ulbricht defense fund as ETH
  • 1% Mars Robertson personal supply :bike::rainbow::deciduous_tree::sparkling_heart::unicorn:as ETH

That means:

  • 45% kept as SUSHI
  • 55% of SUSHI sold to ETH, out of which 45% to be kept in the pool, the remaining 10% distributed (back to the DAO, pay for gas, Ross and me)

TBD, TBC, ā€œreality checkā€

Iā€™m 100% open minded, receiptive to feedback.

ā€œFail forwardā€ - each failed idea is a learning experiment, always having the enthusiasm to start again fresh.

#8

yes so basically you want a Pie, with an yVault for each token.

Is it possible to do that ?

If PieDao want to do something similar itā€™s a lot of work. Because yield farming is very dynamic and a good strategy can be a bad strategy in few days. So you will need something with different statagies. Itā€™s excatly what Yearn is developing for the v2. but itā€™s a lot of work.

In theory I 100% agree with you. A pie with yiedl farming would be amazing. Diversification + highest yield. But i think itā€™s a lot of work.

And other possibility is to use an ā€œYvault Pieā€
eg: DAI, USDC , ETH, YFI. And then each asset is put on an yVault.

#9

Auto farming would be great! When I was playing around with https://hny.farm/ I spent a lot of time rebalancing based on APY. Having an asset that would seek yield and balance between cost, gas, and other factors is very appealing.

Iā€™d like to see other pies turned into pie vaults before another pie is realesed though.

#10

Dammit! It is closed alreadyā€¦

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To be fair, I would not seek strictly the highest APR %. Super high APR % is often temporary.

I would seek something stable, reputable, with liquidity, with long term prospects and predictable monetary policy.

Of course, to develop such a Smart Contract would be some work, especially if there are no standardized interfaces between various yield farming protocols.

This is close: https://github.com/studydefi/money-legos BUT not for yield farming.

Probably the difficulty with the smart contract: ability to execute arbitrary transcations. Timelock. 4bytes function signatures. Operating everything in a decentralized and trustless way - complicated but not impossible.

#11

maybe as an alternative, could we farm YPie/ETH sushi farm?

I think in general you raise a good point that there pooling harvests is beneficial to users. Having a way to pool entry into farms which utilize Pieā€™s could further differentiate the brand, provide value to users in reduced gas costs, and a wrapped strat, donā€™t need liquidity for themselves, as theyā€™d be a distinct offering from Pies, which serve to provide liquidity to pies.

1 Like
#12

We have been having discussions on a reformat of USD++ into a curve farming Vault. Iā€™ll try to formalize a forum post on what I have so far soon.

1 Like
#13

But where are the rewards coming from: https://sushiswap.fi/pools

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I see no incentives to farm YPie/ETH

#14

You need to go to the Onsen MenuScreenshot from 2021-01-03 04-31-09

#15

Is that stable, sustainable, predictable?

Iā€™m not sure how often we want to rebalance the pie.

Suggested farms, suggested pairs?

I donā€™t want unstable 500% on some shitcoin that will dump. More predictable 200% is better IMO.

Slightly similar: https://www.tokensets.com/

BUT: only single pair, only single farm, Uniswap does not pay rewards. Pretty useless IMO.

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DRAFT:

Propose your favourite farms thereā€¦

PIP 46: Re-balance DEFI+L to include SUSHI and YASS Sub-Pie
#16

there is no such thing as predictable in these areas.

#17

I agree. There is no predictability. We are talking approximation.

Some things are known from the very begininng: ā€œpromo period 2 weeks onlyā€ and crazy APR

Some things have a long record of running.

Preference to be given to ā€œboring, stable, predictableā€ blue chips, as oppposed to $DEGEN10 and likewise.

Related

Migration to staking.

So many opportunities, it blows my mind literally :exploding_head:

1 Like
#18

Alternative approach

BCP holds 33% ETH and 33% DEFI++ various tokensā€¦

Iā€™m comfortable to pair ETH with these tokens and yield yield yield even more :innocent:

#20

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Very nice: https://sushiswap.fi/pair/0x5f30aac9a472f6c33d5284f9d340c0d57ef33697

PICKLE: None

Pickle should be staking natively: https://app.pickle.finance/stake

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Cool

Iā€™m very grateful for DEFI++

It would be never possible for me to obtain exposure to so many innovative projects.

I was just thinking about farming underlying assets but YEARN and PICKLE are already doing something similar.

Thank you guys! Much love :pray:

1 Like