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Maximize Yield Strategy

Combine multiple STRATO features to maximize returns on your crypto.

Variable Parameters

All interest rates, APRs, fees, and gas costs in this guide are examples only. Actual values vary based on:

  • Pool utilization and trading volume
  • Market conditions and volatility
  • Protocol governance decisions
  • Network congestion (for gas)

Always check current rates in the app before proceeding.

The Strategy

Use borrowed/minted USDST to provide liquidity and earn multiple income streams.

Income sources:

  1. ✅ Trading fees from liquidity (example: 8-12% APR)
  2. ✅ Reward Points for all activities (varies)
  3. ✅ Keep your original collateral (potential appreciation)

Net result (example): Earn ~10-15% APR while keeping your ETHST

Complete Example: 10 ETHST Position

Your situation:

  • You have: 10 ETHST ($30,000)
  • You want: Maximum yield

The play:

  1. Supply 10 ETHST as collateral
  2. Borrow 10,000 USDST against it
  3. Provide sUSDSST-USDST liquidity
  4. Earn fees + Reward Points
  5. Net yield: ~10% annually

Expected returns:

  • Interest cost: -5% on $10k = -$500/year
  • Liquidity fees: +10% on $10k = +$1,000/year
  • Reward Points: +$500/year (estimated)
  • Net: +$1,000/year (~10% on $10k position)
  • Plus: Keep 10 ETHST exposure

Step-by-Step Implementation

Step 1: Supply Collateral (2 min)

  1. Go to Borrow (sidebar)
  2. In Collateral Management table, find ETHST → Click "Supply"
  3. Enter amount: 10.0
  4. Click "Supply" (approval happens automatically)
  5. Gas: ~$0.10

Result: 

Collateral: 10 ETHST ($30,000)
Can borrow: Up to $22,500 (75% LTV)

Step 2: Borrow USDST (2 min)

Conservative approach:

  1. Go to Borrow (sidebar) → Borrow section
  2. Amount: 10,000 USDST (not max!)

  3. Review:

  4. Health Factor: 2.4 (very safe)

  5. Interest: ~5% = $500/year (example rate)
  6. Click "Borrow"
  7. Confirm (~$0.10 gas)

Why not max? - Max is $22,500 - But borrowing $10k keeps HF at 2.4 - Large safety buffer for price drops

Result: 

Borrowed: 10,000 USDST
Health Factor: 2.4 (very safe)
Interest cost: ~$500/year

Step 3: Get Matching Assets (5 min)

You need: USDST + sUSDSST pair for liquidity

You have: 10,000 USDST
You need: 5,000 sUSDSST

What is sUSDSST? - Based on Sky protocol's sUSDS (formerly MakerDAO) - Yield-bearing stablecoin that earns Sky's savings rate - STRATO-wrapped version for use in the ecosystem - Maintains ~1:1 peg with USDST

How to get sUSDSST:

Option A: Swap half your USDST 1. Go to Swap Assets 2. From: USDST → Amount: 5,000 3. To: sUSDSST 4. Execute swap 5. Gas: ~$0.10

Option B: Bridge from Ethereum (if you have sUSDS) 1. Go to Deposits → Bridge In tab 2. Bridge sUSDS from Ethereum 3. Automatically wrapped to sUSDSST

For this example, use Option A (swap):

Result: 

USDST: 5,000
sUSDSST: ~5,000 (1:1 ratio typically)
Ready for liquidity

Step 4: Provide Liquidity (3 min)

  1. Go to Advanced (sidebar) → Swap Pools tab
  2. Select sUSDSST-USDST pool

  3. Check stats:

  4. APR: Example 10% (fees - varies by volume)

  5. Volume: Check current 24h volume
  6. Reward Points: Active

  7. Enter amounts:

  8. USDST: 5,000

  9. sUSDSST: ~5,000 (ratio typically 1:1)
  10. Click "Add Liquidity" (approvals happen automatically)
  11. Gas: ~$0.10

Result: 

Liquidity provided: $10,000
Pool share: varies
Earning: ~$3/day in fees (example)
Plus: Reward Points
Plus: sUSDSST earns Sky savings rate while in pool

Your Complete Position

Assets:

  • Original: 10 ETHST (as collateral)
  • Borrowed: 10,000 USDST (5k in LP as USDST, ~5k in LP as sUSDSST)
  • Liquidity: $10k sUSDSST-USDST LP tokens

Income streams:

  1. Trading fees: ~$3/day = $1,095/year
  2. Reward Points: ~$1-2/day = $500/year
  3. Total income: ~$1,600/year

Costs:

  • Interest on 10k USDST: ~$500/year

Net profit: ~$1,100/year on $30k position = 3.7% yield

Plus:

  • Keep 10 ETHST exposure (if ETHST appreciates 20%, you earn $6k more)
  • Compounding if you reinvest rewards

Expected Returns Breakdown

Income

Source Amount Calculation
LP fees (10% APR) $1,000/year $10k × 10%
Reward Points $500/year Estimated
Total Income $1,500/year

Costs

Cost Amount Calculation
Borrow interest (5%) $500/year $10k × 5%
Gas fees $50/year Approx
Total Cost $550/year

Net Profit

Net = Income - Cost
    = $1,500 - $550
    = $950/year

Return on borrowed capital: 9.5% APR
Return on total position: 3.2% APR (plus ETHST exposure)

Risk Management

Monitor Health Factor Daily

Your HF starts at 2.4:

  • Very safe with large buffer
  • If ETHST drops 15% to $2,550: HF drops to ~2.04 (still safe)
  • If ETHST drops 30% to $2,100: HF drops to ~1.68 (getting lower)
  • If ETHST drops 50% to $1,500: HF drops to ~1.20 (risky)

Liquidation occurs when HF < 1.0:

  • With $10k debt and 80% liquidation threshold
  • Liquidation at ETHST < $1,250 (58% drop from $3,000)

Actions:

  • Set price alert at $2,100 ETHST (30% drop)
  • If triggered, add collateral or repay debt
  • Keep HF above 1.5 at minimum for safety

Impermanent Loss Consideration

sUSDSST-USDST pair:

  • Both are USD-pegged stablecoins
  • sUSDSST is Sky protocol's yield-bearing stablecoin (wrapped on STRATO)
  • Minimal price divergence (both maintain $1 peg)
  • IL risk is very low (~0.1%)
  • Perfect for this leveraged strategy

Why this pair is ideal:

  • Nearly 1:1 peg maintained between USDST and sUSDSST
  • Small variations only from sUSDSST's accrued Sky savings rate
  • Much safer than volatile pairs
  • You earn Sky's yield on the sUSDSST portion while providing liquidity

Bonus benefit:

  • Your sUSDSST in the pool continues earning Sky's savings rate
  • This provides additional yield on top of trading fees
  • Triple yield: trading fees + Reward Points + Sky savings rate

If using volatile pairs (e.g., USDST-ETHST):

  • Higher trading fees, but also higher IL risk
  • Not recommended for leveraged positions
  • Price divergence can erode profits

Compound Your Rewards

Weekly routine:

  1. Claim Reward Points
  2. Swap Reward Points → USDST
  3. Convert half to sUSDSST via swap
  4. Add both to liquidity pool
  5. Increases your earning power

Effect over 1 year:

  • Simple: $1,500 earned
  • Compounded weekly: ~$1,550 earned
  • Extra $50 from compounding

Advanced: Scale Up

20 ETHST Position

Double everything:

  • Collateral: 20 ETHST ($60k)
  • Borrow: 20,000 USDST
  • Liquidity: $20k
  • Health Factor: 2.4 (same safety)

Net earnings:

  • ~$1,900/year (scales linearly)
  • ~3.2% on $60k position
  • Plus 20 ETHST exposure

Using CDP Instead

Lower interest costs:

  • CDP stability fee: ~2-3%
  • Lending interest: ~5%
  • Savings: $200-300/year

Trade-off:

  • Lower fees
  • But need to manage CR instead of HF

Exit Strategy

When to Exit

Exit if:

  • ETHST price dropping significantly
  • Pool fees decrease below interest cost
  • Better opportunities elsewhere
  • Need capital for other uses

How to Exit

  1. Remove liquidity:

  2. Go to Advanced → Swap Pools → Your Liquidity

  3. Find sUSDSST-USDST position
  4. Click "Remove" to exit LP

  5. Receive USDST + sUSDSST back

  6. Repay debt:

  7. Swap sUSDSST → USDST if needed

  8. Repay full 10,000 USDST debt

  9. Plus accrued interest

  10. Withdraw collateral:

  11. Withdraw your 10 ETHST

  12. Return to wallet

  13. Claim final rewards:

  14. Claim remaining Reward Points

  15. Swap or hold

See: Withdrawals Guide

Alternative Strategies

Strategy 2: Mint + Provide Liquidity

Use CDP instead of lending:

  • Lower fees (2-3% vs 5%)
  • Better for long-term

Strategy 3: Borrow → Stake

Provide liquidity in high-APR pools:

  • Some pools offer 20-30% APR
  • Higher risk (volatile pairs)
  • Can earn more but watch IL

Strategy 4: Recursive Borrowing

Advanced:

  • Borrow USDST
  • Swap to more ETHST
  • Supply as collateral
  • Borrow more USDST
  • Repeat 2-3 times
  • High risk - not recommended for beginners

Real Example: 30-Day Results

Starting position:

  • 10 ETHST supplied
  • 10k USDST borrowed
  • $10k in sUSDSST-USDST LP

After 30 days:

Metric Amount
ETHST collateral 10 ETHST (same)
Debt owed 10,042 USDST (+$42 interest)
LP value $10,025 (fees earned)
Reward Points earned 50 tokens ($100 value)
Net profit $83 for the month

Annualized: $83 × 12 = $996/year (~3.3% yield)

Plus: If ETHST appreciated 10% → +$3,000 gain

Tips for Success

DO ✅

  • Start with conservative borrowing (HF > 2.0)
  • Use stable-stable pairs (sUSDSST-USDST)
  • Monitor health factor daily
  • Compound rewards weekly
  • Keep safety buffer in USDST

DON'T ❌

  • Max out borrowing capacity
  • Use volatile pairs when leveraged
  • Ignore health factor warnings
  • Forget about accruing interest
  • Over-leverage your position

Next Steps

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