What is Alpha Homora?

What is Alpha Homora?

Alpha Homora is leveraged yield farming and leveraged liquidity providing protocol.

ETH lenders can earn high interest on ETH.

Yield farmers can get even higher farming APY and trading fees APY from taking on leveraged yield farming positions.

Liquidity providers can get even higher trading fees APY from taking on leveraged liquidity providing positions.

Supported Pools

Yield Farming Pools

Uniswap (farming UNI)

  • ETH/WBTC - Up to 2.5x leverage

  • ETH/USDT - Up to 2.5x leverage

  • ETH/USDC - Up to 2.5x leverage

  • ETH/DAI - Up to 2.5x leverage

SushiSwap (farming SUSHI)

  • ETH/SUSHI - Up to 2.0x leverage

  • ETH/USDT - Up to 2.5x leverage

  • ETH/USDC - Up to 2.5x leverage

  • ETH/DAI - Up to 2.5x leverage

  • ETH/WBTC - Up to 2.5x leverage

IndexCoop (farming INDEX)

  • ETH/DPI - Up to 1.75x leverage

Pickle.finance (farming PICKLE)

  • ETH/PICKLE - No leverage yet (1x)

mStable (farming MTA)

  • ETH/PICKLE - No leverage yet (1x)

Liquidity Providing Pools

Uniswap (earn trading fees on leverage)

  • ETH/renBTC - Up to 2.5x leverage

  • ETH/UNI - Up to 2.0x leverage

  • ETH/LINK - Up to 2.0x leverage

  • ETH/AAVE - Up to 2.0x leverage

  • ETH/MKR - Up to 2.0x leverage

  • ETH/YFI - Up to 1.75x leverage

  • ETH/SNX - Up to 1.75x leverage

  • ETH/REN - Up to 1.75x leverage

  • ETH/KP3R - No leverage yet (1x)

  • ETH/MTA - No leverage yet (1x)

Protocol Users 👤

Users can participate in Alpha Homora as Yield Farmers, Liquidity Providers, ETH Lenders, Liquidators, and Bounty Hunters.

Yield Farmers 🧙🔒

CAN FARM WITH ONE TOKEN: Once users select a pool, users can farm with just one token. For instance, if users select ETH/DPI pool, users can farm by just supplying DPI. Alpha Homora will automatically and optimally swap the tokens to make sure users have equal value of both DPI and ETH to supply to ETH/DPI pool on Uniswap.

UP TO 2.5x LEVERAGE: Users can borrow ETH with up to 2.5x leverage to yield farm on supported leveraged yield farming pool to earn higher trading fees APY and farming APY.

AUTO STAKING: Alpha Homora will automatically stake LP token to get farmed tokens for users. For instance, Alpha Homora will stake UNI-v2 ETH/DPI LP token on IndexCoop to farm INDEX for you.

AUTO REINVEST: All the farmed tokens will be automatically converted to add onto users' positions every 24 hours or will be automatically reinvested when reinvestor takes action. This makes sure all yields are reinvested to further maximize user's profit.

HIGH DEBT RATIO SOLVENCY: Position stays solvent as long as the debt is worth less than killFactor of the position value. Liquidation takes place when debt ratio exceeds the killFactor . Please monitor your position closely and refill/close when your 'Kill Buffer' is in the red zone.

ADJUSTABLE POSITIONS: Users can at any time choose to add more ETH or another token. Note that users cannot withdraw some without having to close a position with the current design.

Here is an example scenario for yield farmer Alice :

  1. Alice has 100 ETH and wants to farm UNI on ETH-USDT Uniswap pool, where she can normally earn 30% APY. Normally, she can swap roughly half ETH to USDT then supply them to the pool and earn 30% APY (see our blog on how to do it optimally).

  2. With Alpha Homora, she can borrow 150 ETH from Alpha Homora Bank, paying the borrower's interest rate, and together with her initial 100 ETH, she can now farm with 250 ETH (2.5x leverage!) -- earning a total yield of 75% APY, more then TWICE! the amount of her original annual yield.**

  3. Without any further deposit, she can continue farming as long as her position value does not drop below 187.5 ETH.

**Note: Alice also needs to pay the borrowing interest on the borrowed amount, which depends on the ETH utilization rate.

Liquidity Providers

CAN PROVIDE LIQUIDITY WITH ONE TOKEN: Once users select a pool, users can provide liquidity with just one token. For instance, if users select ETH/YFI pool, users can provide liquidity by just supplying YFI. Alpha Homora will automatically and optimally swap the tokens to make sure users have equal value of both YFI and ETH to supply to ETH/YFI pool on Uniswap.

UP TO 2.5x LEVERAGE: Users can borrow ETH with up to 2.5x leverage to provide liquidity on supported leveraged liquidity providing pool to earn higher trading fees APY.

HIGH DEBT RATIO SOLVENCY: Position stays solvent as long as the debt is worth less than killFactor of the position value. Liquidation takes place when debt ratio exceeds the killFactor . Please monitor your position closely and refill/close when your 'Kill Buffer' is in the red zone.

ADJUSTABLE POSITIONS: Users can at any time choose to add more ETH or another token. Note that users cannot withdraw some without having to close a position with the current design.

ETH Lenders 🧙⬆️

Interest Bearing ETH (ibETH): When users deposit ETH to Bank, they receive a proportional amount of ibETH token, a tradable and interest-bearing asset that represents their shares of ETH in the bank pool, similar to cToken in Compound.

EARN INTEREST: Interest paid by ETH borrowers are distributed to ETH lenders*, proportionate to the amount of ETH lent.** Lenders' interest rate depends on ETH utilization rate; the higher the the utilization, the higher the interest rate.

*Note: Borrower's interest rate model follows triple-slope-curve.

**Note: 10% of borrower's interest will go into Bank Reserves, which can be used as an insurance fund for lenders in case of unexpected scenarios. In the future, Bank Reserve authority may transition to community governance.

Liquidators 🧙💥

LIQUIDATION BONUS: Liquidators earn 5% of the position value for liquidating positions at risk (debt exceeding killFactor of the position's value).

Here is an example scenario for liquidator Charlie and overview of liquidation process:

  1. Bob leveraged 2.5x by borrowing 150ETH with his initial 100 ETH to farm UNI on ETH-USDT Uniswap pool. Bob's total position value is currently 250ETH.

  2. Later that week, there's a significant increase in ETH. As a result, Bob's total position value dropped from 250 ETH to️ 175 ETH, leaving his debt at 85% (150 ETH/175 ETH), which is higher than the killFactor of ETH-USDT pool (80%). In this case, liquidator can come in to liquidate.

  3. When liquidation takes place, position value is used to pay debt first (in this case 150 ETH). 5% of the position value of 175 ETH is then paid to liquidator. Hence, liquidator will earn 8.75 ETH in this case.

  4. The remaining 16.25 ETH (175 ETH - 150 ETH - 8.75 ETH) is then returned back to yield farmer.

Bounty Hunters / Reinvestor 🧙💰💰

REINVEST BOUNTY: Bounty hunters can call reinvest function to sell all yield farmed tokens in Alpha Homora portfolio for ETH, and reinvest into the yield farming pool, earning 3% of the total reward in the process!