V2 - Leveraged Yield Farms
Concept of Leveraged Yield Farming
Leveraged yield farming allows users to gain access to assets with undercollateralized loans. Through leveraged yield farming, users can multiply their yield farming principles and achieve higher profits, and on Flux V2’s, the leveraged loan is maxed at 10x.
However, multiplying the yield farming principles comes with higher risks through the leverage! When the collateral cannot cover the platform’s necessary transactions or fees, liquidation of the loan will occur. The liquidation rules state: when the debt ratio reaches a pre-defined rate, liquidation will be triggered. The depth ratio is defined as the debt value divided by position value. The debt value is the value of a user’s borrowed assets, and the position value is the value of a user’s farming position (collateral + borrowed assets + value of LP tokens)
Yield Farming Flow Chart
Farm Parameters
Flux V2 Farm Parameters include platform, LPs, leverage amount, liquidation threshold value, borrowed tokens, etc.
Platform - On which DeFi platform the specific farm is deployed
LPs - The underlying asset pairs to provide liquidity
Leverage Amount - The maximum leverage that is supported for the specific farm, also influencing an account’s total position value
Liquidation Threshold - The debt ratio threshold of a specific position, meaning that a position will be liquidated when the limit is overstepped
Borrow Tokens - The tokens that can be borrowed (LPs) with leverage after the collateral is deposited into the Flux V2 farms
Platform | LPs | Leverage | Liquidation Threshold | Borrow Tokens |
MDEX | HUSD/USDT | 10x | 94% | HUSD/USDT |
MDEX | USDC/USDT | 10x | 94% | USDC/USDT |
MDEX | DAI/USDT | 10x | 94% | USDT |
MDEX | ETH/HBTC | 3.5x | 83.30% | ETH/HBTC |
MDEX | HBTC/USDT | 3.5x | 83.30% | HBTC/USDT |
MDEX | MDX/HBTC | 3.5x | 71.42% | HBTC/MDEX |
MDEX | HT/USDT | 3.5x | 83.30% | HT/USDT |
MDEX | MDX/HT | 3.5x | 71.42% | HT/MDEX |
MDEX | ETH/USDT | 3.5x | 83.30% | ETH/USDT |
MDEX | HLTC/USDT | 3.5x | 83.30% | USDT |
MDEX | HT/ETH | 3.5x | 83.30% | HT/ETH |
MDEX | HFIL/USDT | 3.5x | 83.30% | USDT |
MDEX | MDEX/USDT | 3.5x | 71.42% | USDT |
MDEX | HDOT/USDT | 3.5X | 83.30% | USDT |
MDEX | HBCH/USDT | 3.5X | 83.30% | USDT |
Mining APY Calculations
APY Equation
APY = (1+Total APR)^356 -1
Total APR= Yield farming + Trading Fee + Flux Rewards - Borrowing Interest
Yield farming= LP流动性挖矿的单利年化收益率
Trading Fee = Average trading fees of the past 7 days * current leverage
FLUX Rewards = Flux V2 borrowed assets’ APY * (Current Leverage -1)
Borrowing Interest = Flux V2 collateral (lending) assets’ APY * (Current Leverage -1)
APY Calculation Example
The APR on Flux V2 is 9.35% for the HUSD/USDT LP on the MDEX platform;
Flux Rewards=0%，Borrowing Interest=0%；When the Flux V2 leverage is 1 (no leverage multiplier), both Flux Rewards and Borrowing Interest are 0;
Total APR= Yield farming + Trading Fee + Flux Rewards - Borrowing Interest=9.35%+27.68%+0%-0%=37.03%
Flux V2 Fees
Leveraged Profit Sharing: 0%
Position opening: 0%
Liquidation fees: 5%
Collateral deposit fees: 0%
Auto-compounding fees: 1% - 3% of auto-compounding amount
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