AAVE-MAI-Balancer Multi strategy

3 min readDec 22, 2021

Hello Tetuans, I present Tetu’s new multi-strategy based on AAVE, MAI and Balancer.

AAVE-MAI-Balancer is an innovative Multi-strategy that automatically interconnects three protocols yield farming in each one of them, that’s right, earning rewards in AAVE, QiDao and Balancer.

This solution provides the user with efficient Yield farming by simplifying what would be a slightly more complex process that could require a lot of patience to do a lot of transactions to place assets on each of the platforms and attention to maintenance and management of each of the positions.

Multi strategy

The strategy works as follows:

Tokens are supplied to AAVE and amTokens are received.
amTokens are deposited on QiDao to create camTokens
Create a camTokens vault in QiDao and supply all camTokens as collateral.
borrow MAI by about 50% of the collateral value.
Deposit the borrowed MAI in the BAL stability pool

Using the multi strategy will be simple, all the user will have to do is deposit the single asset token as WBTC, WETH or MATIC and the strategy will do everything else automatically.

Deposit limitations

The strategy should borrow MAI tokens on the QiDAO side. MAI tokens are not always available, you can check current amounts on the page https://app.mai.finance/vaults/create (Compounding Aave Market tokens). We are showing the available amount on Tetu UI. If no MAI is available you should wait until QiDAO refuels it, they do it periodically.

Buyback

Only part of the results of the multi strategy will be used for auto compound, which will only be the APY generated by camTokens. All remaining earnings from the multi strategy will be used to repurchase TETU at the standard ratio of 45/45/10.

Margin Maintenance

The multi strategy automatically adjusts the borrowed assets depending on the Health ratio, but rest assured, this process does not cause any loss in principal amount, only a 0.5% repay fee is charged, but as the loan represents only 50% of the collateral amount this repay rate is effectively 0.25%

Auto rebalancing

The strategy works with collateral and debt management that provides enough time for auto rebalancing and Health ratio maintenance. Although liquidations are technically possible in some unlikely scenarios, as in cases where the price drops 200%, the risks of liquidations are almost non-existent. Even if a liquidation does take place it will only be partial.

Rebalancing of borrowed assets will be made at each level of 10% of the collateral ratio and users will be able to monitor the vault’s liquidation price in the UI to ensure everything is going well.

Advantages of the AAVE-MAI-Balancer Multi strategy

Multi Strategy provides the user with multiple advantages, such as maximizing earnings with single asset yield farming without risk of impermanent loss and almost no liquidation risk.

Conclusion

Like the Folding strategy, the Multi strategy is another innovative impermanent loss free and fully automated Yield Farming strategy developed by Tetu. These Yield farming solutions are exciting and make me wonder what the next strategies might be. The book of wisdom never reveals the future, but it brings good surprises for the skilled masters of patience.