The probability of benefiting from the price increase is significantly higher than farming activity in the current phase.

Leverage is one of the coolest things to profit even more of price appreciation! It can give you so much advantage when you have a small portfolio and less than $500k in your bank, but most people fuck it up.

Greed is a Bitch!

As long as you can’t control your emotions, you shouldn’t touch leverage. Don’t leverage more than you can handle. We often overestimate what we can do. Treat it like I say in my pinned post…

What you lose, you have to earn back. And that can be more difficult than you think.

The recent ezETH depeg has shown how fast it can go. Even with a considered safe asset. Unfortunately, I have been asleep when this happened. This was a damn good opportunity to get some ETH cheap.

What happened exactly?
- Renzo announced their airdrop and people have been mad about the distribution (just drama in my opinion)
- they dumped their ezETH
- bc of the concentrated Uniswap pools (at some point it jumps from a cliff) a massive depeg happened for a short time
- ezETH has always been backed by enough ETH, unstaking isn’t live yet
- but it still caused a lot of liquidations

In the investment section, I provide you with some strategies how I leverage my capital safely. Since a very bad experience from over 10 years ago, when I was trading CFDs, I’ve never been liquidated again.

DeFi Updates

Sandglass, the Pendle of Solana?

It has some differences in the pool structure, but other than that it's similar to Pendle.

The question here is if SOL people are too retarded or will they use it? But I thought the same early when I discovered Pendle and I missed the first run.

However, I’m especially careful when successful projects are being copied. One one hand, it could become successful, too. But people could just try to copy the run from the original project and lose interest quickly. Choosing Solana is kinda smart here. If there’s a good chance of winning this, Sol is the best bet.

On the other hand it’s easy for scammers because of the mentioned dynamics. Sandglass does NOT look like a scam at this point. However, you should be careful!

An interesting project…

Covenant (former Tazz) is looking really interesting. I’m feeling early Pendle vibes with this one. A project with a real use case. I reported in an earlier Newsletter.

Mantle is different, even with its memecoins.

I love what is Puff doing here! It’s a totally different kind of meme and not that boring copy over copy stuff.

Holders getting rewarded when they hold and stake their airdrop instead of selling.

The next chapter has started already and the sooner you bond, the more you profit. Your Puff/mETH will be locked until end of May.

As I told you, Mantle will come with more utility/incentives for the MNT Rewards Station. The ENA campaign ended and now you can earn some raffle tickets to win MYSO tokens.

I can think of something like this when projects give some of their tokens for the Rewards Station and in return they’ll get MNT grants. This could lead to a really nice eco-system which rewards the loyal users on the L2.

And I say it again, they can go on for much longer than people can fade it.

I’m farming on Mantle from the beginning and I can tell, it has been very lucrative. They’re always transparent with what you have to do and how much you can gain. That’s different from most others out there.

Mantle is also integrating FBTC, an omnichain wrapped BTC version.

Next phase. But it looks like people only like to talk about decentralisation. I hope Metis gets some more love in the future.

Something to pay attention to!!!

Investing

I bought some W on the dip, because there’re rumors that staking brings a Monad airdrop with it. Tbh I’m not very bullish on Wormhole, but Monad is going to be big. It’s likely that staking Pyth also makes you eligible for Monad and I still hold 25% of my Pyth airdrop.

I deployed some of the Parcl funds back to Kamino, which I originally had there. Season 2 is running and Kamino is actually a pretty good platform to earn well in the process.

I got me 2 Mad Scientists NFTs. The mint was more on the expensive side with ~$900 per mint. I participated in the streamswap, so it cost me ~$400 per mint. The project is totally different and the first one on Osmosis. Lets see where this goes. It looks like Cosmos NFTs are doing well recently.

RUNE, which made a big junk of my portfolio left. It’s not that I think it will perform bad, but I’m trying to narrow my holdings a little. I have a lot to do in the real life and therefore, I have less brain capacity to manage a lot of positions.
The ThorChain community is a little too focused on the price for my taste. And with the rise of BTC L2s, ThorChain could lose a big market share. I know that L2s and ThorChain is different. Nevertheless, bridging becomes easier and most people don’t care how it’s done.

Ok, now to the leverage strategies… There’s not much magic, you just need a little discipline. Just think about it, leverage lets you utilize capital which you actually don’t have. Don’t get too greedy!

Low leverage of 1.5-3x can change your life dramatically. Just think about it, you’re working with 50% to 200% more capital than you actually own. There’s no need for more if you don’t want to gamble. This brings you in a very well position without constantly worrying of getting liquidated. You usually have plenty of time to adjust your positions so you don’t lose any money.

Here’re some examples how I use leverage. Don’t just copy them. You might have a different life situation and other strategies might suit you better.


1. Timeswap
If you’re a reader of my Newsletter, you know that I love Timeswap, that’s why it gets its own section. It’s one of the best protocols to eliminate liquidations. And with them integrating more memecoins, you can even degen harder and take some risks off the table.

And with LSTs and LRTs, TS provides a very attractive Loan-to- you can borrow very efficiently with up to only 101% over-collateralization. So you can almost borrow as much as you put in collateral.

The disadvantage with TS is the time component and you’re limited in this regard. Therefore it is only suitable for short- to medium term positions.

You can read more about Timeswap and how it works in my Newsletter #18

Myso Finance works similar as Timeswap btw.

2. CDPs and other Lending Protocols
These platforms are perfect for the long-term use. Both come with their own advantages.

For example, I’ve started to build an ETH position on Liquity in the $1300-$1400 price range and increased it all the way up to $1800 and I held it for over a year. The whole time, I payed zero interest.

If there wouldn’t be these annoying redemptions, which is the biggest disadvantage of CDPs. This requires a lot of managing when the stablecoin is under peg.
Fortunately, Liquity is launching V2 soon. It lets you choose your interest rate, which has an effect on the likelihood for being redeemed. I’ll write about it in another letter.

To avoid redemptions, you can also use lending platforms like Aave or another one in the lending category on DefiLlama. If you do that, you have to pay interest on your debt.

I started to build a new leveraged mETH position on Aurelius on Mantle during the dip btw.

3. Loop
This is one of the safer plays, but what is safe anyway (see ezETH)…

You can either loop LSTs/LRTs, which was very lucrative during mETH double dose. Or you loop yield bearing stablecoins like USDY.

A nice place to do this is Minterest on Mantle. Supplying USDY brings ~19% (yield + incentives) and borrowing USDC brings around 3.9% (incentives - interest).
They also have NFTs which boost your rewards. They’re pretty cheap on Mintle right now.

4. Farming Project Points
   The following is more on the risky side, but with doing this stuff, you’re able to farm several protocols. You only need one asset and you leverage it through. Let me explain whit an example on Mode Network…
   
   1. We need ETH and deposit it on Ironclad (+21% APY, Embers)
   2. Borrow wrsETH (-6%, Embers)
   3. Supply wrsETH on Ionic (+2.4%, 2x Ionic, 2x Kelp, 2x Mode, EL points)
   4. Borrow ETH (-5.6%, Ionic, Mode points)
   5. Airpuff (+40%, Airpuff and 10% of accumulated points)
   
   Do NOT leverage to the limit and only do it with a fraction of your portfolio! With every step, you add extra contract risk.
   
   This needs to be monitored very closely. You also want to have an eye on the interest you have to pay on each protocol. We don’t want to lose money in the process of earning points! Short spikes aren’t the problem, but if they stay high, you might want to chose a different route.

Rules:
- don’t lose money for farming points
- preferably use highly liquid assets like BTC, ETH, SOL
- preferably chose platforms with enough liquidity
- don’t leverage to the limit (lower leverage over a longer time usually outcompetes high leverage in a shorter period)
- adjust your leveraged position accordingly to the time you can spend to monitor
- if you have the urge to watch your position every 5 minutes, you’re over-leveraged (you should be comfortable to watch once a day)
- always keep a safety-buffer (enough time to adjust in extreme situations)

Macro

US GDP growth fell from 3.4% in Q4 2023 to 1.6% in Q1 2024, which is more than half. 2.5% was expected.

It also looks like inflation is stickier than most “experts” thought and the fear of stagflation is floating around in the media. But all of that doesn’t matter. Every scenario points towards short fiat and history underlines that. This means that you want to own as much assets as possible in the next years.

Tell me, what’s up when the most important economies crack? Germany, Japan, USA, etc.

Maybe that’s the reason why every corrupt politician is pro escalation. Remember, one way out of the whole financial disaster is war.

I don’t want to be a doomsday caller, but that’s what history tells. Politicians often choose this path. The West just decided to keep funding the Ukraine and NATO forces might deploy to this region soon as well. So more escalation. Meanwhile videos of captured equipment in Moscow are all over social media.

War can’t be won! It’s just a big wealth transfer, but most people lose more than just material stuff. It’s a big shit show and reminds me of the never ending war in Orwell’s 1984.

Rabby Wallet (Best EVM wallet):
https://rabby.io/rabby-points?code=SEXYLIFE
Aurelius Finance (CPD and Lending):
https://app.aurelius.finance/?af=sexy
INIT Capital (Lending):
https://app.init.capital/points?ref=5ECC4D
Spot On Chain (Analytics Platform):
https://platform.spotonchain.ai/referral?code=0r3wi0eg6n33
HMX (Perp Trading, Arbitrum, Blast):
https://hmx.org/arbitrum/referral?ref=SEXYLIFE
Merkle Trade (Perp Trading, Aptos):
https://app.merkle.trade?ref=ISEOW51X
NFT Perp (NFT perp trading, Arbitrum, Blast):
https://app.nftperp.xyz/referral?code=DCAA40EE
Parcl (Real Estate Perp):
mojolife
Ironclad (Lending on Mode):
https://app.ironclad.finance/points?referralCode=ZZZZZ3ih

Stay Sexy!

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