RaArΞs ⚓️

aave has a $USDC pool paying 7.8% rn / but how long that rate will survive lol? i've been using aave since the ethlend days, & there's a lot more you can do there than supply some stables 🧵👇 here are 5 ways i'd approach earning on aave rn, from passive yield to the more risky stuff (+ sources i use) i) supply the high rate spots $USDC on optimism is paying 7.8% supply on around $9.91m in the pool. $PYUSD on eth is paying 7.3% supply on only $7.12m. $USDC on avalanche is at 6% w/ around $67.8m supplied. $USDC on linea is 6.4% on $1.14m. $USDT on eth is 3.9% supply & 4.6% borrow w/ around 93.8% utilization & $2.58b supplied. $WETH on the v4 eth main spoke is 1.7% on around $100m. w/ $10k in $USDC on avalanche at 6% you'd earn about $600 a year if the rate stays the same. w/ $50k that is roughly $3,000. the displayed APY already includes aave's protocol cut, but rates change as ppl deposit & borrow, so actual earnings can be lower or higher. i usually prefer utilization in the 70-90% zone, but most of these stablecoin pools are already above 90%, so i'd be careful w/ sizing. ii) umbrella for the extra yield on top umbrella is aave's onchain risk management system. you stake your aTokens like aUSDC or aUSDT and get an extra reward stream on top of the normal supply rate. the total yield depends on the asset & how much is already staked, since umbrella rewards change too. say the combined yield is 5%. w/ $10k staked that would be about $500 a year total. w/ $100k it is around $5,000, assuming the rate stays the same. you take first-loss slash risk if bad debt shows up after the dao offset. there is a 20-day cooldown to exit, followed by a 2-day withdrawal window. your funds can still be slashed during cooldown. i use this when i am already supplying and want the dual stream w/o adding leverage. iii) $GHO savings $GHO is aave's stablecoin / sGHO is what you get paid for hodling $GHO. sGHO is paying a 4.5% savings rate rn w/ around $201m deposited. the rate is set by governance, so it can change. w/ $10k in sGHO you'd earn about $450 a year at that rate. w/ $50k that is $2,250. no slashing risk and no cooldown. $GHO borrow on eth core is still at 4.6%, set by governance. this is the cleanest passive way i hold $GHO. iv) eMode loops eMode is aave's efficiency mode. you supply something like $WSTETH or a yield stable, borrow against it at high ltv in eMode, then redeposit and repeat. ltv can go to 90%+ on some correlated assets w/ a small liquidation bonus. each loop adds a bit of extra carry but your health factor drops fast. say you start w/ $10k & loop to $30k supplied, w/ $20k borrowed. at 5% supply yield & 3% borrow cost, you'd earn roughly $900 a year, or 9% on your original capital before costs. but rates, asset prices & liquidations can change that quite a lot. i'd keep leverage limited & watch the health factor closely, since even correlated assets can move apart. v) liquidations and flash loans you repay part of an underwater position and take the collateral plus a bonus that depends on the asset & market. some bonuses are around 4.5-7.5%, while certain eMode positions can be as low as 1%. flash loans on aave v3 generally start at a 0.05% fee, although governance can change it, so you don't need your own loan capital, but you still need gas. a $10k flash loan liquidation w/ a 5% bonus gives around $500 gross collateral bonus & a $5 flash loan fee at 0.05%. your actual profit depends on the liquidation fee, gas, slippage & execution. bots take most of the mainnet opportunities but cheaper gas on L2s can make smaller liquidations worth attempting... i only touch these when the bonus clears the fees & gas by a clear margin. rates move w/ every deposit and borrow so i check aavetracker before i do anything. i'd watch the small high-utilization pools for higher rates, but those yields can disappear pretty fast. umbrella adds rewards on top of the normal supply yield, while sGHO is a separate savings option w/ no cooldown.