KyberSwap DeFi Tutorial: How to Earn 34% APR with wstETH

kyberswap defi tutorial

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

Lido, the most popular liquid staking protocol in DeFi, is ready to expand to L2s! With almost $5.7B in staked ETH (stETH), Lido DAO announced they’d be allocating 150k LDO rewards to incentivize wstETH LPs on Arbitrum and Optimism dApps including Beethoven X, Balancer, Curve, Velodrome, and KyberSwap. Thus far, the most trading volume per liquidity appears to be on KyberSwap on Optimism, which has about $1.53M in wstETH/ETH liquidity earning fees on about $2M in trade volume the last 24 hours.


Source: KyberSwap Optimism wstETH/ETH LP analytics

As a result of the lesser liquidity combined with increased trade volume, there’s ~29.31% APR in LDO + KNC rewards subsidizing LPs, while there’s real yield (trading fees) earning LPs an additional 4.82% APR, netting just over 34% APR. A KyberSwap Elastic Pool like this allows users to provide liquidity to a pool within a custom price range, similar to the concentrated liquidity design of Uniswap v3.

Today, I’ll show how I can deposit a combination of wstETH + ETH into a KyberSwap elastic pool LP and earn a net 34% APR as of this writing, before adding the liquid staking yield of 4.9% for the underlying wstETH.

How to Earn 34% APR with wstETH on L2 with KyberSwap

34% APR with KyberSwap

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