137% APR On Solana By Defi Dad

Before we get started, a reminder that this is not a recommendation or endorsement to buy any tokens mentioned in this tutorial.

Previously, we’ve covered leveraged yield farming through a popular DeFi application by Alpha Finance called Alpha Homora. Leveraged yield farming became popular when Alpha Homora on Ethereum showed that there was demand among yield farmers to use a single dApp that streamlines the process of borrowing tokens like stablecoins, ETH, and WBTC at a lower borrowing rate and then swapping those tokens to create a larger LP (liquidity provision) and farm yield rewards that far outweigh the borrowing interest. Suddenly, farmers had the ability to net out larger amounts of yield with leverage and as a result, Alpha Homora grew to upwards of $3.8B TVL since launching in 2020. 

Similar to Alpha Homora, a new protocol launched in August 2021 for leveraged yield farming on Solana called Francium. Francium is a “decentralized automatic investment platform” which not only offers leveraged yield farming but also is developing a “DeFi automation toolset.” I would liken this future utility in Francium to Set Protocol on Ethereum. Eventually, Francium “strategy builders” will be able to create automated DeFi investment vaults that might include trading, staking, lending, LPs, and more.

As of this writing, Francium has accrued just over $70M in TVL on Solana.

In order for yield farmers to borrow and build larger LP positions to farm greater rewards on protocols like Orca and Raydium on Solana, there must be a borrowing pool of these assets, which creates demand for lenders of these blue chip assets on Solana like stablecoins,

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