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  • 🧭Navigation
  • 🦙Alpaca Finance
  • Our Protocol
    • 🏆Our Products
    • 📈How to Participate
      • Introduction to Six Simple Strategies to Earn
      • Strategy 1: Hold a Token While Earning High Yields at Low Risk; aka Lend & Stake
      • Strategy 2: Hold a Token Pair to Earn Auto-Compounded Yields Without Leverage
      • Strategy 3: Supercharge Your Stablecoin Yields
      • Strategy 4: Multiply Crypto Gains in a Bull Market
      • Strategy 5: Yield Farm Profitably in a Bear Market
      • Strategy 6: Multiply Crypto Gains in Any Market by Hedging
    • 🗺️Roadmap
    • 🔒Security
    • 📃Transparency (Audits & Contracts)
    • 🔗Links
    • 📰Media Coverage
    • ❤️Charity
    • 🌐Global Protocol Parameters
      • ⏫Leveraged Yield Farming Parameters
      • 📈AF1.0 Interest Rate Model
      • 📖Automated Vault Parameters
      • 📗Perpetual Futures Exchange Parameters
      • 📙AF2.0 Parameters
  • Tokenomics
    • 📀ALPACA Token
    • 💰ibTokens
    • ⚖️Pool Allocations
    • 🔥Proof of Burn
      • Burn Sources Details
  • Lending
    • 🏦Introduction to Lending
    • ❗Risks
    • ⏭️Step-by-Step Guide
      • Lend & Stake
      • Withdraw
  • Leveraged Yield Farming
    • 🚀Introduction to Leveraged Yield Farming
    • 🏊Pool-Specific Parameters
      • PancakeSwap Pools
      • Mdex Pools
      • Biswap Pools
      • SpookySwap Pools (Deprecated)
      • WaultSwap Pools (Deprecated)
    • 🧮Leveraged Yield Farming Mechanics
      • PancakeSwap Farms
      • Mdex Farms
      • Biswap Farms
      • SpookySwap Farms (Deprecated)
      • WaultSwap Farms (Deprecated)
    • 🌊AF1.0 Liquidation
    • ❗Risks
    • ⏭️Step-by-Step Guide
      • Open a Leveraged Yield Farming Position
      • Adjust a Leveraged Yield Farming Position
      • Close/Partially Close a Leveraged Yield Farming Position
      • Claim Rewards
      • Liquidate Positions
  • Automated Vaults
    • ⚙️Introduction to Automated Vaults
      • Market-Neutral Strategy
      • Savings Vault Strategy
    • 🧮Hedging Mechanics
    • ⏬Lowering Vault Leverage Mechanics
    • 🔏Private Automated Vault
    • 📈Backtest Results
    • ❗Risks
    • ⏭️Step-by-Step Guide
      • Invest in an Automated Vault
      • View Your Automated Vault Position
      • Withdraw from the Automated Vault
  • Perpetual Futures Exchange
    • 🔮Introduction to Perpetual Futures Exchange
      • Traders
      • Liquidity Providers
    • 🚀Launch Plan
    • 💲Trading Fee Discount Program
    • 🎁Referral Program
    • ❗Risks
    • ⏭️Step-by-Step Guide
      • Open a Leveraged Position
      • Manage a Leveraged Position
      • Close a Leveraged Position
      • Swap Asset
      • Invest in & Stake ALP token
      • Unstake & Withdraw ALP token
  • Alpaca Finance 2.0
    • 💎Introduction to Alpaca Finance 2.0
      • Money Market
      • Leveraged Yield Farming
    • 🚀Launch Plan
    • ⭐Incentive Rewards
    • 🌊AF2.0 Liquidation
    • ❗Risks
    • ⏭️Step-by-Step Guide
      • Deposit
      • Borrow
      • Repay
      • Withdraw
      • Transfer between Accounts
      • Looping Strategies
  • Governance
    • 🗳️Governance Vault
    • 🍃Grazing Range (New)
    • ⚡Early Withdrawal
    • 🔎Governance Sources Details
    • 📝Governance Discussion and Voting
    • 🗒️AIP Details
      • AIP-1: Handling of ITAM Rewards
      • AIP-2: Governance Vault on Fantom
      • AIP-3: Handling of Governance Vault’s Early Withdrawal Penalty
      • AIP-4.1: Handling of a recent bad debt on WaultSwap’s position
      • AIP-4.2: Solution to eliminate bad debt risks from remaining Waultswap positions
      • AIP-5: Interest Model Adjustment
      • AIP-6.1: Limiting Access to Automated Vault
      • AIP-6.2 Limiting Access to Automated Vault
      • AIP-7: Handling of a recent bad debt on Fantom Network
      • AIP-8.1: Increase AUSD utility by providing access to high-leveraged AVs
      • AIP-8.2: Increase AUSD utility by providing access to high-leveraged AVs
      • AIP-9: Deposit Liquidation Treasury Funds into Lending Pools while waiting to be used for buyback
      • AIP-10: Further optimizing the borrowing interest rate slope
      • AIP-11: Adjust Stability Fee for AUSD to help restore peg
      • AIP-12: Handling of bad debt from the recent stkBNB's depeg
      • AIP-13: Removing xALPACA requirement for accessing high-leveraged Automated Vaults
      • AIP-14: Close remaining LYF positions on stkBNB-BNB pool to avoid any potential future bad debt
      • AIP-15.1: Incentives for New Upcoming Products (Perp, AF2.0)
      • AIP-15.2: Distribution Method - Incentives for New Upcoming Products (Perp, AF2.0)
      • AIP-15.3: Incentives Amount for Perp - Incentives for New Upcoming Products (Perp)
      • AIP-15.4: Incentives Amount for AF2.0 - Incentives for New Upcoming Products (AF2.0)
      • AIP-15.5: Sources for Incentives - Incentives for New Upcoming Products (Perp, AF2.0)
      • AIP-16: Adjusting Slope3 max interest rate
      • AIP-17: Handling of extra ALPACA tokens from the AIP-15 incentives
      • AIP-18: Sunsetting Leveraged Yield Farming Support for MDEX pools
      • AIP-19: Implement Shielded Voting
      • AIP-20: Aligning AF1.0 lending performance fee structure with AF2.0
      • AIP-21.1: Adjusting bad debt repayment scheme from the stkBNB de-peg event
      • AIP-21.2: Adjusting bad debt repayment scheme from the stkBNB de-peg event
      • AIP-22: Paid Marketing Budget for Alperp and AF2.0
      • AIP-23: Sunsetting Leveraged Yield Farming Support for TUSD
      • AIP-24.1: New Governance Vault Implementation
      • AIP-24.2: New Governance Vault Implementation - Unlocking Period
      • AIP-24.3: New Governance Vault Implementation - Transferability
      • AIP-24.4: New Governance Vault Implementation - Early Withdrawal
      • AIP-24.5: New Governance Vault Implementation - Early Withdrawal Penalty Model
      • AIP-25: Migration from AF1.0 -> AF2.0
      • AIP-26: Transitioning the Governance Vault
      • AIP-27: Alpaca Insurance Plan Update
      • AIP-28: Updating Governance Voting Structure
      • AIP-29.1: Converting Remaining BUSD in AF1.0 lending into USDT
      • AIP-29.2: Charging conversion fees to the remaining BUSD depositors
      • AIP-29.3: Determining the conversion fees
      • AIP-30: New Product Proposal - Stablecoin
      • AIP-31.1 Handling of remaining assets in the AUSD’s stable swap module
      • AIP-31.2 Handling of remaining assets in the AUSD’s stable swap module
      • AIP-32: Distribution Plan to Lenders of Stablecoins from THE Liquidation
    • ⏭️Step-by-Step Guide
      • Lock ALPACA in Governance Vault
      • Lock more ALPACA/Extend Lock Time
      • Claim Rewards from Governance Vault
      • Add Custom tokens to your MetaMask
      • Vote on Alpaca Improvement Proposal (AIP)
      • Early Withdraw ALPACA from Governance Vault
      • Withdraw ALPACA from FANTOM Governance Vault on BNB Chain
      • Withdraw xALPACA from old Governance Vault
  • ALPIES
    • 🌗Introduction to Alpies
    • 🚋Bridging your Alpies
      • Bridging Alpies from ETH to BNB Chain
      • Bridging Alpies from BNB Chain to ETH
    • ⚡Boosted Leverage
  • Join the Herd (AlpaCareers)
    • 🚀Hiring Section
  • Help center
    • 👩‍🏫Alpaca Academy
      • Lesson 0 - How to Buy Alpaca and Start Earning Yields for Beginners(Lending+Staking)
      • Lesson 1 - Alpaca Finance’s Unique Use-Case — Shorting at a Profit
      • Lesson 2 - Introduction to Hedging with Double-Sided Borrowing
      • Lesson 3 - Liquidation Risk in Leveraged Yield Farming
      • Lesson 4 - Open/Close Positions With 0 Swap Fees
      • Lesson 5 - The Truth About Impermanent Loss and Common Misunderstandings
      • Proficiency Exams (earn NFTs)
    • 📚General Knowledge Articles
      • Navigating the Economic and Safety Landscape of DeFi
      • Yield Farming and Liquidity Mining: The Engines of DeFi Growth
      • Leveraging Advanced DeFi Instruments for Secured Funds Compounding with Alpaca Finance
      • Get Stablecoin Yields and Build Crypto Savings with Alpaca Finance's Lending Platform
      • Understanding the Basics of Decentralized Finance (DeFi)
      • Advanced Ways of Decentralized Trading with Alpaca Finance’s Perpetual Futures Exchange
      • Maximize Your Returns with Automated Vaults and Leveraged Yield Farming on Alpaca Finance
      • What does 'buy and hold' or HODL mean in investing?
      • What is DeFi Governance and why is it important?
      • What exactly are DeFi Money Markets?
      • What is yield farming and how does it differ from traditional investing?
      • What exactly does 'unlocking liquidity from long-term holdings' mean?
    • ❓FAQ
    • 🧰Useful Tools
    • 📘Terminologies & Calculation Methodology
      • 🧮APY Calculation
      • 📈Profit/Loss Calculation
    • ⚠️Common Error Messages
    • 💸Third-Party Earning Opportunities with ALPACA
  • Developers
    • 🐞Bug Bounty Program
    • 🎛️Protocol Configurations
    • 💻Integrating With Alpaca Finance
    • 🏛️AF2.0 Repurchasing Guide
    • ⚡AF2.0 Flashloan Guide
  • Past Products
    • 💵AUSD (Old)
      • 💵Introduction to AUSD
      • 💹How to Participate
      • 💦AUSD Liquidation
      • 〰️AUSD Price Stability Module
      • ❗Risks
      • ⏭️Step-by-Step Guide
        • Open an AUSD Position
        • Adjust an AUSD Position
        • Close/Partially Close an AUSD Position
        • Add/remove AUSD-3EPS LP tokens
        • Redeem AUSD for ALPACA
      • 📔AUSD Parameters
    • 🗳️Governance Vault (Old)
    • ⚡Early Withdrawal (Old)
    • 🌿Grazing Range (Old)
    • 💪Stronk Vault
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On this page
  • Strategy 1: Hold a Token While Earning High Yields at Low Risk
  • Strategy 2: Hold a Token Pair to Earn Auto-Compounded Yields Without Leverage
  • Strategy 3: Supercharge Your Stablecoin Yields
  • Strategy 4: Multiply Crypto Gains in a Bull Market
  • Strategy 5: Yield Farm Profitably in a Bear Market
  • Strategy 6: Multiply Crypto Gains in Any Market by Hedging

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  1. Our Protocol
  2. How to Participate

Introduction to Six Simple Strategies to Earn

An introduction to maximizing your farming yields with Alpaca Finance

PreviousHow to ParticipateNextStrategy 1: Hold a Token While Earning High Yields at Low Risk; aka Lend & Stake

Last updated 3 years ago

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Alpaca Finance offers a variety of investment methods that can optimize the capital efficiency of your crypto assets. As such, whether in a bull or bear market, you’ll always have opportunities to maximize profits.

Now, with this goal in mind, we’ll briefly describe six simple strategies unique to Alpaca, presented in order of simplest first, to accommodate new users to advance one step at a time as they learn about the powerful earning tools within our platform. (We’ll also be rolling out articles for each of these strategies which you can read by clicking on their titles)

Farm Crypto Tokens with Leverage(Long Positions): In bull markets, gain significant upside by opening leveraged yield farming positions with your favorite crypto tokens, preferring to borrow stablecoins, or the token in the pair that you are less bullish about. (Example: if you expect BNB price to rise more than BTCB, you can open a BNB-BTCB position where you should borrow BTCB). By using this strategy, you can get more than 3x on your yields compared to Strategy 2, of course at higher risk.

Farm Crypto Tokens with Leverage(Short Positions): In bear markets, gain upside by opening leveraged yield farming positions, borrowing crypto assets such as BNB, ETH, or BTCB that you believe will drop in price. (Borrowing above 2x is similar to shorting the asset you borrow. So you can open a position on BUSD-BNB, borrowing BNB and thus be short on BNB). This is one of the only ways to remain profitable while yield farming in a bear market, and you can Alpaca's leveraged yield farming platform is one of the only places you can do it.

Strategy 6: Multiply Crypto Gains in Any Market by Hedging

Farm Crypto Tokens with Leverage(Hedged Positions): In any market conditions, you can hedge risk by yield-farming a multi-position strategy using a combination of strategies 4 and 5 to be both long and short on the same crypto asset, counteracting their corresponding long & short exposures which would make you hedged neutral. This can achieve a similar hedged effect as strategy 3 using stablecoins but typically with higher APYs. (Example: borrow BNB to go short farming BUSD-BNB, and also borrow BUSD to go long farming a second position on BNB-BUSD. If you set your positions properly, the long&short exposures on BNB will cancel each other out, leaving you neutral. One caveat with this strategy though, is that you only start hedged when you open the positions. As BNB price moves, your neutral exposure can shift long or short due to AMM asset rebalancing, so you would want to monitor that and adjust your positions periodically)

Regarding Strategies 4, 5, and 6, they have some nuance but are easy to understand once you just spend a little time to learn about them!

In any case, if you didn’t understand any strategies on the first read, fear not young Alpacas. Within the coming days, we’ll be releasing short articles with more information on each of these strategies to help you gain a clear understanding of how to use them to grow your portfolios.

Lend & Stake and then your individual crypto assets (BUSD, USDT, BNB, BTCB, ETH, ALPACA) for the highest single-asset yields within DeFi at very low risk.

Farm Auto-compounded LPs: and auto-compound your favorite PancakeSwap or WaultSwap LP token pairs(at 1x without leverage) for yields that are the highest in the BNB Chain & Fantom ecosystem. Comparison chart .

Farm Stablecoins with Leverage: When wary of market volatility, hedge risk by yield stablecoin-stablecoin pairs with up to 6x leverage. These pairs have relatively low risk, are unlikely to suffer any impermanent loss, and provide high APYs. Alpaca’s yields are among the highest for stablecoins in all of crypto.

For the time being though, you can find more thorough explanations on how to best use leveraged yield farming to multiply your gains in any market conditions within .

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Lend
stake
Strategy 2: Hold a Token Pair to Earn Auto-Compounded Yields Without Leverage
Farm
here
Strategy 3: Supercharge Your Stablecoin Yields
farming
Strategy 4: Multiply Crypto Gains in a Bull Market
Strategy 5: Yield Farm Profitably in a Bear Market
Alpaca Academy
Strategy 1: Hold a Token While Earning High Yields at Low Risk