Double-Digit Passive Yields: Leverage Strategy Vaults by Contango

Contango

Before we get started, this is not a recommendation or endorsement to buy any token(s) mentioned.

This week, we cover Contango Strategies, which offers automated leverage vaults using perps with low funding rates and competitive fixed yield of Pendle PT’s!

A few weeks ago, we covered a newer strategy that auto-compounds Pendle ETH LP yield using a Beefy Finance vault. This Contango strategy will build off of our knowledge of Pendle Principal Tokens (PTs) offering guaranteed fixed yield, combined with looping a leveraged position of a yield-bearing asset.

Before we break down how to enter Contango Strategies, let’s get to the basics of how Contango works.

Contango allows you to open a perps position built by looping onchain with deep liquidity on battle tested protocols such as Compound, Aave, Spark, Morpho, Silo, Dolomite, and more.

Contango Perps

How Contango creates a long ETH/DAI position

With Contango integrated across Ethereum Mainnet, Arbitrum, Base, Optimism, and Gnosis, users can do any of the following:

  • create leveraged positions just like perps with low funding
  • lever up on liquid staking and restaking yield
  • lever up on the fixed yield of Pendle PTs
  • create delta neutral plays to farm funding rates
  • arbitrage rates differentials on stablecoins
  • farm rewards, airdrops, points on leverage

A few of the advantages to the Contango design for perps trading are:

You trade the deepest liquidity onchain, thanks to Contango aggregating from $7B in spot market liquidity

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