Compounding

While taking a simple loan is not necessarily complex, using the loan protocol to its fullest requires multiple transactions to stake, claim, and route loan proceeds or staking rewards to various destinations. The Amplifier will simplify this process, allowing you to process complex actions with a single-click.

The unique nature of EARN’s loans not charging interest or requiring regular payments and providing two staking opportunities to earn yield allow innovative leverage strategies to be employed. These strategies can be as simple as maintaining maximum exposure in the Stability Pool by automatically claiming liquidation rewards, swapping back to the stablecoin and restaking back into the Stability Pool. Or they can be as complex using leverage to build your native coin position and maximize passive income staking rewards from the stability and staking pools.

Below is a list of all of the lending protocol functions that can be simplified using Amplifier strategies and automation.

Compounding Debt

• Take a loan to mint new stablecoins based on changes to collateralization ratio caused by price changes or deposits to the vault

• Route minted stablecoins to deposit in the Stability Pool to earn liquidation rewards and EARN or LOAN tokens

• Swap minted stablecoins to collateral tokens and deposit to vault to raise collateralization ratio

• Swap minted stablecoins to EARN or LOAN and stake in the Staking Pool to earn lending and redemption fees.

Compounding Stability Pool

• Claim liquidation rewards and deposit into vault to raise collateralization ratio

• Claim liquidation rewards, swap to stablecoins and deposit back in the Stability Pool

• Claim EARN or LOAN token rewards and stake in the Staking Pool to earn lending and redemption fees

• Claim liquidation rewards and EARN or LOAN to wallet

Compounding Staking Pool

• Claim lending fees in stablecoins and deposit in Stability Pool

• Claim lending fees in stablecoins, swap to collateral tokens and deposit into the vault to raise collateralization ratio

• Claim redemption fees in collateral tokens and deposit into the vault to raise collateralization ratio

• Claim both fees to wallet