Alpaca Finance – Leveraged Yield Farming – Overview

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Hello there bill i heard you quit your job at the bank that’s right cesar i’m a rancher rancher what kind of animals alpacas wow yes alpacas live high in the mountains in high altitudes brio you live in a skyscraper yes that’s right but alpacas have beautiful colors 22 colors exact but bill you wear the same black suit every day alpacas are green animals well

Beale you drive a hummer alpacas don’t bite they don’t have sharp teeth boo you’re a vampire alpacas are great investments and they produce lots of wool oh whoa i need me some more i gotta get me some alpacas welcome to caesar snack sandwich today we’re on finance smart chain taking a look at alpaca finance leveraged yield farming by the alpacas for the

Alpacas it’s a pretty fair launch i’m not going to get into the tokenomics of the alpaca token but i will talk a little bit about the products that you can use inside this application and you can take a deeper look at everything in all the details if you are interested in this so let’s swing over to the application by clicking on this button here so when the

Place first loads up we see that this is where we land on the landing page we can see that this entire protocol has about 1.5 billion dollars inside it so it’s getting adopted that’s for sure so first step you can do the first option you could do is you could lend other people these tokens you could lend them alpaca b and b b usd or eth tokens so you can decide

Which ones you want to lend you the apys are all here so you have lending apr or you know the basically how much they’re going to people are going to pay you to borrow these tokens this number changes the pace based on this utilization percentage the higher the utilization the higher the percentages you can see now the staking apy is when you actually deposit

Your tokens in here and then you go to stake so if you click stake you will end up here and you can stake your token like i b a b and b in here and you can start earning alpaca rewards as well so let’s go back to lind so here on len so you see there’s staking apr and then there’s the total which is the sum of these and then apy based on the fact if you were to

Daily harvest your alpaca tokens and sold them for more and stuck them in here okay so you can basically look at this and say oh i’m going to get 34 if i put busd in here all by itself that’s pretty good now remember that this number will change frequently as utilization goes up and down so let’s go over to what people are doing when they borrow these tokens

From you to do that we go to right here farm click on farm and we end up here first thing you’ll see is positions that you have open i have a few open right now i had some more before but things went to all-time high so i closed them and i’ll explain that a little bit later okay so when we come down here we have active pools now basically what this is doing is

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It’s allowing you to borrow some tokens and build lp’s on pancake swap pancake swap incentivize these lps with cake tokens so this protocol is going to build you some lp’s and harvest the cake for you and compound it so that’s basically what this number is yield farming is basically the compounding of the cake rewards into more lps for you now as you can see

That it says trading fees unavailable and so this number could could be very different depending on the the pair right but these are some of these pairs are very popular so the trading fees can be up into the hundreds and so forth they can be quite quite substantial but the reason why there’s no data is because pancake swap went to version two and their data set

Up you know feeds is not quite working yet so this number come and check this when you come back and you’re just trying to decide whether or not you want to play around with this product or not but i’ve seen you know like some of these up in the one case you know like the total apr is like 1.5 thousand percent so it’s pretty pretty respectable now these trading

Fees are still happening they’re still there it’s just we cannot see the number so you’re still going to get that percentage right but let’s go down and talk a little bit about this part here this allows you to filter the pools so basically these are the tokens that you’re going to borrow from other people so one of the things that you have to think about is

When you borrow these tokens you’re going to be shorting that token so you want to borrow the token that you think will go down in price you don’t want to borrow a token that you think is going to go up in price so for example if i press b and b and i were to go to any of these right let’s go to this one these two down here so basically if i’m borrowing b and b

I think b b is going to go down in price versus busd so versus the us dollar right now this is a little bit different if i borrow b and b i think it’s going to go down in value versus wi-fi so the comparison of these two tokens not the us dollar it has nothing really well it does have a little bit to do with us dollars it’s the us dollars of both of them but

It’s if this goes up a lot and this goes up a little bit then i will still be gaining some i it wouldn’t be a terrible thing to short versus wi-fi if wi-fi went up quite a bit but this is important to understand because basically what it’s going to do if you come here let’s open one of these and i will show you let’s open to farm so the first thing you want

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To do when you open you want to find out what are you going to borrow so if i borrow busd that means i’m shorting the us dollar so i’m kind of longing this bnb versus the busd so it’s the first thing you want to look at or what am i going to borrow here okay so as you can see i borrow the bosd and then i sell some of that will i use some of the usd to buy up b

And b and then the b and b will go up in value hopefully and then when i try to sell the bnb i will be able to pay off my debt much faster now i’m not going to spend a lot of time explaining this if you really don’t understand leveraged lps i suggest you to come and read this article read it a couple times it will make things very clear for you they have very

Good examples in here and if you still don’t understand after this you can hit me up on telegram and i’ll try my best to explain it to you a little bit better but i don’t have time to explain everything in high high detail here so let’s go to another pool another pair instead of b and b busd and this time let’s choose cake bnb and go to farm so when we look at

The top we see oh if i open this position i will be borrowing bnb tokens so now you can see i can come here with b b tokens or i can come here with cake or i can come with both of them but it you know i have to it it’ll balance things out for me it’ll sell some of them and balance it out and make my lp’s for me 50 50. okay okay so another very important thing

Is that you can decide how much leverage you want to use so down here you can see i can change it to 1.5 i can change it to 2 and i can change this to 2.5 now some of them go all the way up to 6 percent so this is important if you bring one b b here and you borrow two b and b then in essence you have three b b worth of lps open and this is important because it’s

Basically giving you more total apy because as you can see this apy changes if i click here it changes it goes up quite a bit because i am basically putting myself more in debt however i will be farming more cake and more trading fees and so forth but you have to watch this you have to watch your kill ratio and your debt and stuff like that i’m not going to get

Into all how to how to run this how to use this this is something that you’re going to have to look at in your time but just know that you are basically having the option to leverage your tokens and that’s what makes this power this protocol so powerful so in this case if i’m going to borrow b and b i want the b b price to go down in reference to cake so because

I’m going to be using some of this b b to buy some cake so i want the cake to go up in value so later when i have to pay off the amount of bmb i borrowed i will have i’ll be able to sell some of this cake for the bnb and close my position in a profit so it’s kind of complicated you need to basically watch the graphs watch the price action of these two tokens and

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Make sure that you are within a profit now it basically breaks everything down for you quite well um remember that these trading fees are a little bit off right so we can’t trust it completely the numbers right now but i found them to be pretty accurate and it does close it down quite easily all by itself let’s go back to my positions okay so let’s just choose

This first position here let’s say i wanted to close this for whatever reason i felt necessary i would click the close and then it would come in here and it will break everything down for me it’s quite good you can go through these numbers carefully when you’re here and when you’re trying to figure out you could pause the video and look at it more carefully but

Basically it does show you me right down that i would end up with this much usdt in my token in my wallet because you know i have to pay off my busd i borrowed six thousand dollars and i have about you know seven thousand eight thousand about eight thousand right so i would end up with this many usdt tokens and if i didn’t do any trading but if i decided oh i

Want busd back it’s going to sell sell everything back to busd and give me this much busd okay so it depends on what you came with and what you want when you leave you can decide which is better for you if you feel comfortable holding this token or if you want to trade back to the token that you are borrowed and so forth so yeah i think it’s quite useful it’s

Very very accurate and very helpful to give you all this information right here when you’re trying to decide whether or not to close the position so um the the docs are very good i would suggest you to come and read the docs um the the community is quite nice the mods are helpful and they answer all the questions and stuff like that so you can check out the telegram

And all of these discords and so forth and i really suggest you come and read this this will give you a very good understanding of what it means to use this for shorting or longing tokens and so forth okay so i hope this has been useful um i’m not gonna i don’t have time to get into this very very deep and explain every little number but i hope it’s piqued your

Interest and you decide to come and check it out a little bit more thank you for watching and goodbye

Transcribed from video
Alpaca Finance – Leveraged Yield Farming – Overview By Ceazor’s Snack Sandwich