Case Study: 115% USDC APY for locking AAVE: Conditional sale not met
Lets say you have 350 $AAVE tokens, which are valued at $225 dollars each. You want to generate $15,000 USDC today. To do that, you are willing to lock your tokens for 2 months and would be willing to sell them if they rose in price to $250 dollars each.
Using Hedgey, you create that agreement and someone buys it, paying you $15,000 USDC instantly.
Two months to the day pass and $AAVE never rose to $250. The contract expires. You keep your $15,000 (as you always do) and you get back your 350 $AAVE tokens that were locked up for 2 months.
For yield calculation we assume your principal investment of the 350 AAVE tokens at $225 = $78,750. You still yield 19% USDC for 2 months (15k / 78k) => 115% APY, and get to keep your AAVE tokens!
Last modified 2mo ago
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