A brief example
Alice holds BNB and wants to ‘put it to work’ for her in order to maximise yield and is aware of the risks that come with this. Using our the Bigfoot platform, powered by Eleven Finance, the process is quite simple.
Alice comes to . She decides she would like to ‘leverage up’ her exposure to the BNB/CAKE liquidity pool pair, allowing Bigfoot to farm for her with this increased leverage.
Using the platform she selects this pair and her desired amount of leverage (and therefore risk) from the dashboard page. This tells the contract to borrow the additional BNB she needs in addition to her collateral (in her case it’s BNB) from the Bigfoot bank. Here she deposits her BNB as collateral and the contracts take care of the additional borrowing position (as BNB is borrowed from the Bigfoot Bank).
The Bigfoot contract then converts all this BNB into 11CAKEBNB. It does this using 50% of the BNB to purchase CAKE, then adding liquidity to PancakeSwap for this pair, then depositing these LP tokens into the relevant Eleven Finance vault, in this case 11CAKEBNB.
From here, there is no more action required by Alice, she can monitor her position and see her LP rewards grow, through autocompounding of rewards being sold, additional LP tokens bought and re-staked.
All these compounded rewards result in additional value of Alice’s LPs. As this value grows, Alice’s lending and therefore liquidation risk can be reduced.
However the opportunity for gains don’t stop here. The Bigfoot contract goes to work further for Alice, by staking her 11CAKEBNB tokens, in the ‘Elevenchef’ contract. This earns ELE, which is distributed to Alice as E11 — the compounding form of ELE, meaning more gains for Alice.
So to summarise this example lets say the 11CAKEBNB vault is rewarding at rates of 153.82% APY, if Alice opens a position with 2.5x leverage, the APY for her position would be ~ 462%. In addition to this she is also earning E11, which further add to her gains.
At any time Alice can withdraw from the system, where she would pay any relevant fees/interest, pay back her borrowed BNB and receive the remainder of the BNB tokens (which will be inclusive of compounded LP rewards, minus 0.1% vault withdrawal fee).
Last modified 6mo ago
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