Maximize Returns on Your Ether: Lido’s Staking Supercharged with Leverage

In the evolving landscape of Ethereum staking, Lido has emerged as a cornerstone, offering accessible and efficient staking solutions for a growing number of Ethereum enthusiasts. Their platform has become a go-to for users seeking to earn rewards on their ETH holdings without the complexities of the manual staking processes. With Ethereum’s transition to proof-of-stake, the interest in staking has surged, and platforms like Lido are at the forefront of this transformative wave.

But what if there was a way to not just participate in Ethereum staking, but to significantly amplify your returns? This is where the Boosted ETH Staking Basket enters the scene — an innovative yield strategy that creates a 10x leveraged position in stETH (Lido’s staked Ethereum) by utilizing Balancer flash loans and AAVE’s lending capabilities.

The Power of Simplification

Designing the underlying strategy of the Boosted ETH Staking basket is possible for any advanced user, but can be daunting due to its complexity and technical demands. This is where the basket vault comes into play. By simply holding the basket tokens, you’re staking your ETH’s with Lido but at boosted returns (and risk, of course).

The Strategy Behind the Yields

• Lido Staking: The core of the yield comes from staking with Lido, where it provides the staking returns along with the reward tokens.
• Leveraging Loans: A 10x leveraged stETH position is created using Balancer flash loans and AAVE borrowing.

• Why Choose the Boosted ETH Staking Basket?

  1. Ease: You can say goodbye to the extensive learning curve and technical abilities required to complete this transaction through your own smart contracts
  2. Accessibility: Open to all Ether holders on the Ethereum chain
  3. Transparency: Clear and straightforward reporting of yields and operations.
  4. And, of course, higher-yield.

  Comparison between ETH Staked in Lido vs Boosted ETH Staking Basket

  The following graph shows the difference between the yields received by staking ETH in Lido and staking the same amount in Boosted ETH Staking Basket. Using the backtesting method, the Boosted ETH Staking Basket provided an 11% APY, whereas for Lido the number was only 4.2%. This is a 2.6x jump!

  Understanding the Risks

  While the strategy aims to maximize returns, it’s important to be aware of the risks involved, primarily around the stability of stETH’s value and the potential costs in trading stETH for ETH. For instance, at times stETH’s value traded at a discount to ETH. Closing this strategy costs 0.50% so be mindful of how this cost will impact your returns based on the duration that you hold your basket.

  Conclusion

  The Boosted ETH Staking basket represents a unique opportunity for Ethereum holders. By leveraging the expertise of Lido and the power of AAVE’s Flash Loans, Affine offers a simplified yet potent avenue for boosting your Ethereum staking yields.