The gas fee obstacle for leveraged yield farming has been reduced with Alpha Finance Lab’s newly deployed Alpha Homora V2 on Avalanche. The product is very popular because crypto farmers can combine yield farming tokens with borrowed tokens as collateral. The borrowed tokens are combined with owned assets to boost the APR by up to 3 times over standard yield farming arrangements.
With this launch on Avalanche, Alpha Homora V2 will break the gas fee obstacles for many users that can be much cheaper than on the other networks. With almost 900M TVL already on Alpha Homora V2, users will find plenty of opportunity for unique trading possibilities and liquidity in the market.
Here’s how it works.
Leverage Yield Farming
The innovative side of leverage yield farming on Alpha Homora V2 allows crypto farmers to combine their yield farming tokens with borrowed tokens as collateral. So users can earn even higher APR/APY exceeding the limit set by DEX protocols.
For instance, on Alpha Homora V2, you can supply $100 of USDT.e and borrow $200 of AVAX. Therefore, by combining both assets, you will have a total of $300 of collateral assets. This is then used to leverage yield farm, in which the reward is the return on $300, translating into 3X of the original APR/APY.
Trader Joe offers yield farmers 86.2% APR on USDT.e/AVAX pool, by leverage yield farming this pool through Alpha Homora V2, you can earn more, such that 3X on 258.6% APR (86.2 x 3) is possible.
