Tetu Farming Aggregator – Deep Dive
As you all know, I briefly covered Tetu Finance last Monday. I pretty much gave a basic overview of the project and briefly explained how users can earn a relatively high APY by depositing a variety of currently listed crypto assets. This week however, I have done a lot more research in order to grasp an even deeper understanding of this project, and in turn, I have decided that I would like to take a deeper dive into this ambitious new protocol and what it has to offer, and also cover what the protocol aims to achieve in the future within this industry.
As previously discussed, Tetu is a yield management protocol that is built directly on top of the Polygon network (an Ethereum aligned scaling solution). That means low gas, and fast transactions which essentially makes interacting with this protocol a seamless experience and relatively beginner friendly exercise.
The Tetu Vision
In a nutshell, Tetu is a Decentralised protocol built on top of the Polygon network that’s main purpose is to implement automated yield farming strategies for its users. Basically, this is a process where all the user needs to do is simply deposit the required funds into one of the pools on offer, which will trigger the Tetu protocol to put your assets to work for you and automatically start generating you a yield. And the amazing thing about this process is that the user doesn’t really need to do anything themselves, until they are ready to withdraw their funds. Quite frankly, these kinds of services are exactly what we need within this industry, we need streamlined services that are simple and easy to use because we need to collectively make this just as accessible to a beginner as it would be for a DeFi veteran.
Tetu Features – What Can I Do?
As explained above, Tetu offers a service where users are able to deposit funds and earn a yield based off of the automated yield farming strategy implemented by the Tetu protocol. As with most DeFi tokens, a huge aspect of the protocols native token is of course governance. Basically, by locking your xTETU within one of the pools, you will receive dxTETU in return which can then be used by community members to vote on proposals and help govern the direction of the protocol in the future.
SmartVault System
Tetu utilises the SmartVault system, an innovative combination of implementations that have been drawn from the Sythetix pool, and in doing so, Tetu shares the same innovative reward sharing model as Synthetix. Tetu also draws implementations from the Yearn vault in order to use a similar share price model. This works well for both the protocol as well as the everyday end user. Tetu shares a fundamentally strong and innovative model, while the community receives a product that has already been used and battle tested by the public. This means that users can be sure that the products are as safe as possible and that security, as always, is a top priority.
Earn High APY’s
Currently, Tetu’s liquidity pools are offering substantially high returns for its users. Although these APY’s are quite high, keep in mind that the more users that onboard and start using the protocol, the lower the APY will become over time due to more users adding more liquidity into the pools. At the time of writing the TETU-IRIS pool is offering by far the highest returns, the APY for this pool is currently sitting at a cool 600%. As I said above, normally these returns don’t stay this high for too long, and in quieter DeFi periods it’s all about getting into new projects early before everybody else piles in their capital.
Beginner Friendly
A major aspect and very important factor that I would like to take into account for this protocol is the user interface. Tetu offers are really nice, simple and easy to digest interface that won’t seem daunting to a newer user. As well as looking the part, Tetu is also very easy to use. To provide liquidity into one of these pools the user simply either has to deposit the required asset or deposit the required LP token, which can be acquired by exchanging the appropriate pair via a DEX like Quickswap or SushiSwap. My personal favourite is the single sided pool.
My favourite type of pool is actually one that only requires a single asset to be deposited, but what’s even better, is being able to deposit a single ‘stable’ asset into a pool that is offering a quite juicy APY in return. Tetu offers single sided liquidity into their USDC pool, which is currently offering around a 40% APY at the time of writing. What this means is that a user can deposit a stable asset that is pegged to the US Dollar, deposit it into the pool, generate a yield, and then when they are ready to, they can withdraw their funds and take some profits. This method is much safer, far easier to manage, and that’s exactly why single sided staking is one of my favourite DeFi activities. I like to keep things simple and as risk free as possible.
So, if you’re a new user looking for direction on how to put your digital assets to work, or if you’re even just someone looking for somewhere to put your idle stable coins to good use, I would highly recommend checking this protocol out. Afterall, nobody wants their digital assets just sitting in their wallet collecting dust, they want their assets working for them in an efficient and profitable manner.
Thanks for reading everyone!
Liam Donald
This newsletter is for educational purposes only and should never be considered as financial or investment advice