Rainforest Stack #013 Best DeFi Yields (Feb 9, 2024)

Discover the latest in DeFi yields with Rainforest Stack. Uncover various strategies and opportunities in yield farming, presented in an easy-to-understand format for DeFi rookies and experienced farmers alike.

One Click Team
One Click Labs

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Jerome Powell gave a rare interview this month and said the quiet part loudly. ‘‘The U.S. federal government is on an unsustainable fiscal path. And that just means that the debt is growing faster than the economy… We’re borrowing from future generations.” The losers of this generation are anybody holding the dollar/ treasuries when the printer eventually comes back on to debase the dollar. The real long-term losers are the next generation, who will have to foot the bill. People will need to run to quality, and macro trends provide ripe and fertile fields for currency with fixed monetary rules. Congratulations.

DeFi TVL remains in an uptrend, and it has been airdrop season. Congratulations to anybody who followed our advice and staked $TIA. A very generous airdrop from Dymension. The modularity narrative is only just starting. Welcome to the era of modular money. Wormhole also announced their $W token this week, and on-chain degens are already re-capitalized.

Welcome to the Rainforest Stack. A guide for the intrepid into the dynamic world of DeFi yield.

Constituted of four distinct layers: undergrowth, understory, canopy, and the emergent layer. Each layer boasts a different level of risk broadly categorized in line with the Lindy effect- the longer something has survived, the more likely its continued existence becomes.

An impact with oversized ramifications in the crypto space where hundreds of new protocols live and die each quarter.

More details about the Layers of the Rainforest stack here.

Emergent Layer — Enduring Yields

  1. Pool: stETH on Lido. APY: 3.44%. TVL: $22.6b. Chain: Ethereum
  2. Pool: DAI on Maker (DSR). APY: 5%. TVL: $1.16b. Chain: Ethereum
  3. Pool: rETH on Rocket Pool. APY: 3.13%. TVL: $2.64b. Chain: Ethereum
  4. Pool: frxETH on Frax. APY: 3.70%. TVL: $741m. Chain: Ethereum
  5. Pool: GMX on GMX V1. APY: 1.88%. TVL: $273m. Chain: Arbitrum
  6. Pool: GLP on GMX V1. APY: 7.69%. TVL: $145m. Chain: Arbitrum
  7. Pool: USDC-ETH (0.05%) on Uniswap V3. APY: 16.12%. TVL: $143m. Chain: Ethereum
  8. Pool: DAI-USDC-USDT on Curve Finance. APY: 1.28%. TVL: $194m. Chain: Ethereum
  9. Pool: USDT on Stargate. APY: 7.2%. TVL: $25.46m. Chain: Ethereum
  10. Pool: WBTC-ETH (0.3%) on Uniswap V3. APY: 16.02%. TVL: $253m. Chain: Ethereum

Observations

Nothing overly exciting. Continued trend of GMX V2 absorbing all the good yields.

Notable Mentions

Pool: mETH on Mantle. APY: 7.2%. TVL: $1.02b. Chain: Mantle

Congratulations to Mantle’s native LST $mETH recently crossed $1 billion and is one of the largest and most successful vampire attacks of 2024.

Pool: DAI on Aave V3. APY: 25.7%. TVL: $3.2m. Chain: Optimism

Stablecoin suppliers stay eating! Major stablecoins on massive platforms are paying out excellent yields, and users do not have to look hard to find robust double-digit APYs for their stablecoins.

Canopy Layer — Established Yields

  1. Pool: BTC-RUNE on THORSwap. APY: 19.33%. TVL: $112m. Chain: Bitcoin
  2. Pool: RDNT-ETH (80/20) on Balancer. APY: 19.80%. TVL: $68m. Chain: Arbitrum
  3. Pool: BNB-USDC on GMX V2. APY: 42.79%. TVL: $5m. Chain: Arbitrum
  4. Pool: SOL-USDC on GMX V2. APY: 28.83%. TVL: $23.6m. Chain: Arbitrum
  5. Pool: XRP-USDC on GMX V2. APY: 28.51%. TVL: $2.2m. Chain: Arbitrum
  6. Pool: ETH-RUNE on THORSwap. APY: 19.29%. TVL: $60.4m. Chain: Ethereum
  7. Pool: LINK-ETH (0.3%) APY: 31.46%. TVL: $32.03m. Chain: Ethereum
  8. Pool: LDO-ETH (0.3%) on Uniswap V3. APY: 55.43%. TVL: $11.06m. Chain: Ethereum
  9. Pool: RLB-ETH (0.3%). APY: 36.63%. TVL: $5.94m. Chain: Ethereum
  10. Pool: MATIC-ETH (0.3%) on Uniswap V3. APY: 47.06%. TVL: $7.12m. Chain: Ethereum

Observations

GMX V2 remains an excellent yield spot. All the trading activity is taking place here, and again, a call for anybody still holding $GLP to consider providing liquidity for a V2 pair instead.

LDO-ETH is an excellent pair. LDO is one of the central ETH betas, and this alignment in performance helps minimize impermanent loss in both directions.

Notable Mentions

Pool: USDC-RUNE on THORSwap. APY: 118.69%. TVL: $18.49m. Chain: Ethereum

Pool: USDT-RUNE on THORSwap. APY: 144.88%. TVL: $17.14m. Chain: Ethereum

THORSwap liquidity providers are eating well as stablecoins leave the Ethereum ecosystem. This highlights one key lesson for yield farmers. The best way to be profitable is to ideally anticipate, but if not anticipate, react quickly to changing market dynamics. An easy example would be providing liquidity to core pairs on chains with increasing TVLs.

Understory Layer — More Unpredictable Yields

  1. Pool: CANTO-ETH (1%) on PancakeSwap V3. APY: 687.83%. TVL: $484,000. Chain: Ethereum
  2. Pool: PENDLE-ETH on Camelot. APY: 234.23%. TVL: $1.89m. Chain: Arbitrum
  3. Pool: LINK-ETH on Camelot. APY: 64.37%. TVL: $1.38m. Chain: Arbitrum
  4. Pool: PNP-ETH on Camelot. APY: 64.47%. TVL: $2.21m. Chain: Arbitrum
  5. Pool: XAI-ETH on Camelot. APY: 111.54%. TVL: $1.15m. Chain: Arbitrum
  6. Pool: TAO-ETH (1%) on Uniswap V3. APY: 322.98%. TVL: $2.56m. Chain: Ethereum
  7. Pool: SOL-WIF (1%) on Orca. APY: 232.35%. TVL: $2.77m. Chain: Solana
  8. Pool: ARB-ETH on TraderJoe. APY: 154.89%. TVL: $3.22m. Chain: Arbitrum
  9. Pool: SOL-USDC on Orca. APY: 144.56%. TVL: $2.41m. Chain: Solana
  10. Pool: TRUMP-ETH on Uniswap V2. APY: 114.28%. TVL: $3.14m. Chain: Ethereum

Observations

TRUMP-ETH pair absolutely printing despite being an old V2 pool. Mechanism Capital (crypto fund) has taken strategic positions in Trump coins and NFTs. Headed into an election cycle and with Trump’s ability to monopolize attention, this may be an excellent long-term pairing.

ETH betas are having their moment in the sun, and classic pairings like ARB-ETH and PENDLE-ETH are absolutely ripping. Triple-digit APYs on blue chip altcoins paired with $ETH. A yield farmer’s dream.

Notable Mentions

Pool: DYM Staking on Dymension. APY: 42.39% TVL: N/A Chain: Dymension

Pool: TIA Staking on Keplr. APY: 14.7 % TVL: $10.3b Chain: Celestia

Modular Money Season is taking off, and anything at the base of the stack has massive airdrop potential. The growing success of targeting specific communities has become a trend in the recent hailstorm of airdrops, and staking $TIA and $DYM will unlock dozens of airdrops over the next twelve to eighteen months.

Undergrowth Layer — Newest Players / Highest Risk

  1. Pool: SILLY-SOL on Kamino. APY: 25,595%. TVL: $89,000. Chain: Solana
  2. Pool: RUG-ETH (1%) on Uniswap V3. APY: 5,115%. TVL: $596,000. Chain: Solana
  3. Pool: JUP-USEDCAR on Kamino. APY: 4,862%. TVL: $67,000. Chain: Solana
  4. Pool: POPCAT-SOL on Kamino. APY: 10,244%. TVL: $51,000. Chain: Solana
  5. Pool: ETH-DEGEN (0.3%) on Uniswap V3. APY: 307%. TVL: $3.4m. Chain: Base
  6. Pool: ETH-FRAME (1%) on Uniswap V3. APY: 8,776%. TVL: $56,000. Chain: Base
  7. Pool: JUP-WEN (1%) on Kamino. APY: 933%. TVL: $518,000. Chain: Solana
  8. Pool: NOL-ETH (1%) on Uniswap V3. APY: 3,360%. TVL: $33,000. Chain: Base
  9. Pool: JOE-MOE LP Vault on Circuit. APY: 824%. TVL: $7,400. Chain: Mantle
  10. Pool: MINU-MNT LP Vault on Circuit. APY: 1,465%. TVL: $82,000. Chain: Mantle

Observations

A resurgence of memecoins on Solana. Crazy volumes going through tiny liquidity pools lead to outrageous APYs. But the meme season breaking out on Base is more interesting. The Ethereum wealth effect leads to bigger liquidity pools and slightly more stable APYs.

Circuit is a leading protocol on Mantle and still has no token. Given Mantle’s generous $mETH offerings building a digital footprint on this chain with as many tokenless protocols as possible simply makes sense at this moment.

Notable Mentions

Pool: afSUI on Aftermath. APY: 3.62%. TVL: $18.13m. Chain: Sui

Pool: haSUI on Haedal. APY: 3.26%. TVL: $18.60m. Chain: Sui

Aftermath and Haedal are liquid staking protocols on the Sui network. 3% APYs does not look very exciting, true. But neither of these protocols has released a token yet. Minting and holding the LST will undoubtedly be part of the airdrop criteria if these protocols decide to launch tokens.

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Disclaimer: This article, including insights on the “Rainforest Stack” and other DeFi strategies, is for informational purposes only and should not be considered as financial advice, investment recommendations, or an endorsement of any particular investment or strategy. The cryptocurrency and DeFi markets are highly volatile and unpredictable. Past performance is not indicative of future results. One Click Crypto makes no representations or warranties regarding the accuracy, completeness, or timeliness of the information provided. Readers should conduct their own research and consult with independent financial advisors before making any investment decisions. By using this information, you agree that One Click Crypto is not liable for any losses or damages arising from your investment choices.

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