Midas CEO Iakov Trevor recently revealed some exciting updates for the crypto lending and borrowing platform, Midas. Keep reading as we cover the new APRs, new yield generation strategy, Midas Boost, and insurance and audit plans.
According to Trevor, Midas.Investments have grown exponentially over the last eight months, following its pivot towards CeDeFi yield generation. Given the platform's success in DeFi, Midas could sustainably produce yields four times higher (on average) than the traditional CeFi market.
A diversified approach across multiple blockchains and verified protocols made it possible for Midas. Reportedly, Midas is now operating with 10x the amount of deposits from late last year. Thus, the platform has tailored its investment approach to adapt further based on market constraints.
Midas' Updated Yield Rates for BTC, ETH, and Stablecoins
Along with new investment strategies, Midas is also updating its yield rates from May 9. This will allow the crypto lending platform to scale its TVL (Total Value Locked) without exposing user funds to cumulative risk. In addition to the revised yield rates, with the Midas Boost, users can earn an additional 3% to 4% APY
- Bitcoin (BTC): 9.0% APR, 9.4% APY, and 12.1% APY with Midas Boost
- Ethereum: 9.5% APR, 10.1% APY, and 13.4% APY with Midas Boost
- Stablecoins: 16.6% APR, 18.05% APY, and 22.0% APY with Midas Boost
Midas' "Base Yield" Strategy
Over the last three months, Midas' "investment team has worked on creating yield generating mechanisms." While providing one of the highest yields in the market, it can sustain through at least $1 billion in AUM. Midas refers to this as their "Base Yield" strategy.
Moreover, this strategy is designed for a bearish market and primarily focuses on stablecoin yield generation. With a rising trend in protocols competing for efficiency and liquidity for their stablecoins, Midas sees them as the optimal venue to focus its strategy.
Furthermore, stablecoins have no exposure to volatile assets and provide the highest liquidity. Midas produces the "Base Yield" on BTC and ETH by borrowing stablecoins from the native asset, and using it to reinvest profits back into the native asset.
The platform claims to be 200% over-collateralized on its crypto loans and monitors them within each block through its infrastructure. Additionally, Midas is almost finished with its automated algorithmic solution for tracking the health factor of its positions, preventing any occurrences leading to loss of funds.
90% of Midas' user assets are deployed towards its "Basic Yield" strategies, allowing it to offer market-leading yields. Meanwhile, the platform also plans to adjust yields based on the efficiency of its yield strategies.
Trend Allocations & Midas Boost
With 90% of user funds deployed towards its basic yield strategy, Midas plans to use the remaining 10% to obtain and manage exposure to DeFi assets and protocols. Moreover, it plans to gradually increase its position and manage it according to the overall trend growth.
The 10% position helps in Midas's DeFi research, increasing the portfolio returns by some margin. In turn, Midas returns the extra yield to the investors via the Midas Boost.
If you opt to earn payouts in Midas' token, the Midas Boost helps increase the return on all your assets. Also, this contributes to the liquidity of Midas' token, steadily increasing the health of the coin.
Midas' Liquidity on Hire
The first DeFi strategy in which Midas has allocated some of its DeFi funds is the "Liquidity for Hire." This strategy includes protocols and tokenomics built around accumulating liquidity or voting power of some protocols and lending it to other protocols.
For example, Convex, Curve, and Tokemak are "Liquidity for Hire" trend protocols. In fact, Midas plans to build its position in those protocols and accumulate additional yield from bribes.
Midas' combination of "Base Yield" and "Liquidity for Hire" strategies creates an antifragile investment infrastructure. In addition, it has limited and manageable risks, providing steady returns.
Insurance & Audit Plans for 2022
Insurance is one of the most critical factors contributing to the security of a crypto lending platform. For this, Midas has developed an insurance combination to gain immunity from all potential mishaps.
Firstly, Midas is obtaining custodial insurance through Fireblocks, its wallet infrastructure. This insurance covers the risk of Midas hosting user assets.
As for DeFi investment risks, Midas' investment portfolio consists of more than 50 positions. The platform aims to establish a Midas insurance fund to cover each DeFi position's allocation. If the DeFi landscape adversely impacted its positions, the Midas insurance funds would act as a stabilizer.