1️⃣ Select a pool
2️⃣ Supply liquidity
3️⃣ Select leverage & how much of each asset you want to borrow
4️⃣ Confirm strategy
Let’s take a look into the details.
As mentioned, Alpha Homora V2 will enable leveraged yield farming of liquidity pools that are on Curve, Balancer, SushiSwap, and Uniswap. Users can select these pools on Dashboard page.
Yield farmers don’t need to have equal value of both tokens in order to yield farm on Alpha Homora v2 (similar to Alpha Homora v1), as Alpha Homora v2 will automatically and optimally swap the assets to arrive at equal value of both tokens before taking care of the yield farming process for our users. In the example below, users can supply only DAI or only ETH or both.
Leveraged yield farmers can select the leverage level they want to open a farming position at.
Once selected the leverage level (e.g. 2.33x shown below), a user needs to specify which asset the user wants to borrow and for how much. Using the image below as an example, if the user wants to borrow only DAI, he needs to select 100% DAI and 0% ETH. If the user wants to borrow both DAI and ETH in equal proportion, he needs to select 50% ETH and 50% DAI.
Note 1: The asset(s) you supply as a collateral (step 2 in this guide) will determine the proportion of the asset(s) you can borrow.
Note 2: The total % of all assets under Borrows would need to add up to 100% for a user to achieve the selected leverage. This means at 100/100 Borrow Power, the position's actual leverage is the selected leverage. At <100/100, the position's actual leverage will be less than selected.
For instance, if a user specifies 2.33x leverage, but only borrows 25% in ETH and 25% in DAI, the leverage level that the user gets will be lower than 2.33x.
Note 3: The tool-tip on Debt Ratio will tell the user how much an asset would have to swing to put this position at liquidation risk. Liquidation risk takes place when Debt Ratio = 100%.
Finally, confirm the strategy. After that, Alpha Homora will take care of the yield farming process for you. Note that once you have an open position, you need to monitor your positions and manage it to prevent liquidation. See how to manage your open positions here.