Eat your veggies: How we use Pickle Finance in our DAO Citadel strategy
In this article, we will dive into Pickle Finance.
Why? Because Pickle Finance is one of the decentralized applications (dapps) we use in our DAO Citadel strategy.
First, let’s quickly recap our DAO Citadel strategy.
Currently in its second iteration, the DAO Citadel strategy is a crypto ETF + yield farming strategy on the Ethereum network.
ETF refers to exchange-traded funds. Like traditional ETFs, our DAO Citadel ETF strategy invests in a basket of assets, namely Bitcoin (BTC), Ether (ETH), and the DeFi Pulse Index (DPI), which is a market capitalization-weighted index that tracks the performance of DeFi assets across the market.
Here is where we differ from traditional ETFs and most other crypto ETFs. Once we invests into BTC, ETH and DPI, we do not just hold it. We want to provide maximum returns for our investors, so we go one step further and yield farm those assets.
How do we do that?
Here’s where yield aggregators like Pickle Finance enter into the picture.
Most dapps allows users to farm their spot assets to earn yield. In our DAO Citadel strategy, we farm our users’ BTC, ETH, and DPI tokens on dapps such as Sushiswap, Curve Finance, and, of course, Pickle Finance.
Sushi and Curve are well known in the DeFi space, so they probably don’t need more introduction. Pickle Finance is a little more under the radar, which is why we’re writing this article to highlight the role that Pickle Finance plays in our strategy.
So what is Pickle Finance?
Simply put, Pickle Finance is a multichain yield aggregator, similar to yearn.finance and Beefy Finance. It has been around DeFi scene since September 2020. It aggregates and compounds yield from selected dapps on the Ethereum network as well as dapps from other chains such as Polygon, OEC, Arbitrum, and Moonriver.
Like how Yearn Finance has Vaults, Pickle Finance has different Pickle Jars for its yield strategies. Below is a sample of Pickle Jars on the Ethereum network. We can see the different Pickle Jars: pJar 0d, pJar 0.99y, pJar 0.99d, pJar 0c, and pJar 0.99r. Each Pickle Jar accepts a certain LP token from either Uniswap, Sushiswap, or Curve.
Below is an infographic provided by Pickle Finance on how their Jar mechanics work.
How do we use Pickle Finance in our DAO Citadel strategy?
Firstly, when users deposit their stablecoins (USDT, USDC or DAI) into the Citadel strategy, the stablecoins are zapped into Curve, Sushiswap and Pickle Finance according to the component weightage.
30% of the deposited stablecoins are swapped for hBTC-wBTC LP tokens at Curve to earn CRV rewards. Another 30% of the stables are swapped for DPI-ETH LP tokens at Sushiswap to earn SUSHI rewards.
The remaining 40% of the stables are zapped into the wBTC-ETH pool and the DAI-ETH pool on Sushiswap to obtain their respective Sushiswap LP tokens, which are then staked in Pickle Jars — pJar 0.99d and pJar 0.99a.
Upon staking the Sushiswap LP tokens into the 2 Pickle Jars, we will receive pJar tokens, which are then deposited into Pickle Farms to earn PICKLE rewards, which will then be sold, with the proceeds being reinvested to zap more Sushiswap LP tokens to be staked in the Pickle Jars and so on. The process continues perpetually in a loop.
As you can see, in a bull market, users benefit from not just capital appreciation by holding spot assets, but also from the multiple folds of additional yield on their assets. In a bear market, when prices of everything go down, the additional yields can reduce and cushion losses.
Sure, all this can be done manually by the farmer, but it is extremely time-consuming and laborious. You don’t want to sit in front of your computer all day clicking on buttons to harvest your yield, do you?
Our DAO Citadel strategy automates and optimizes everything for you.
Pickle Finance is one of the more hardworking and on-the-ball yield aggregators out there. They are constantly updating and upgrading their product suites by either expanding into new chains or adding more jars. Pickle Finance is a key part of the DAO Citadel strategy and we are glad to be working with them. Our mothers are right when they ask us to eat our veggies, they are good for you! Eat more pickles!
DAOventures is a DeFi ETF Index Fund for fund managers and crypto investors. Its mission is to make DeFi simpler, more accessible, and inclusive. DAOventures provides baskets of auto-compounding LPs, upon innovatively designed crypto ETF index funds.
About Pickle Finance
Pickle Finance helps users to maximize their DeFi yields by auto-compounding their rewards, saving them time and gas.