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Eleven Finance vaults explained
Background
Some defi protocols offer participants the opportunity to receive returns or yield for interacting with them. In the quest of yield defi users often seek out decentralised exchanges as sources of yield. On Binance Smart Chain the leading decentralised exchange is Pancake Swap, which sees far and away the highest volume of transactions taking place on it every day.
The beauty of this volume is that users providing liquidity to these exchanges see a cut of transaction fees, more volume = more fees = more yield.
Providing liquidity to the platform is as simple as owning both tokens of any given pair, supplying these to the exchange, in return for an LP token, or put simply a record of you providing a given amount of liquidity to the ‘liquidity pool’.
Furthermore, the Pancake Swap platform offers liquidity providers of certain pools further rewards, in the form of their native token $CAKE, in return for staking these LP tokens with their platform. Given the specific pool and amount of liquidity provided these rewards can be pretty attractive. But what if there was an even better way?
Our vaults
Enter Eleven Finance, a network of yield optimised vault, automating much of this process to provide even greater rewards for defi participants and liquidity providers. By providing liquidity to Pancake Swap, Eleven Finance users, can then stake their LP tokens at eleven.finance in our vaults. For a small vault fee of 0.1-0.2%, that is only charged on withdrawal of LP tokens, these vaults earn higher returns through strategies such as automated compounding of $CAKE rewards and LP fees, to re-buy more LP tokens in the given pool and repeat this process. When users want, they can remove their LP tokens from the vaults.
Our vaults do not just work on Pancakeswap farms, other platforms incentivise liquidity providers through distributing their own tokens as rewards to these providers. We have optimised vaults and tailored strategies that interact with these platforms (often newly released tokens) and will continue to seek community feedback as to the potential for development of new strategies moving forward.
A recent example of this is our partnership with Wault Finance and their WaultSwap platform. We use an auto compounding strategy to optimise gains for those who build wLP's on WaultSwap and deposit these on Eleven.Finance.
Last modified 1yr ago
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