How Tortle Ninja Make Yield — Farms, Vaults and the Magic of Compounding Interest
An article by Javi Blanco Thomas, founder of Tortle Ninja.
Tortle Ninja is a complex tool that enters a field of finance that I will refer to as esoteric. Tortle Ninja sits on top of more than 800 smart contracts and requires understanding how to provide the highest yields. It can be difficult at times, even for seasoned DeFi users.
In this article, we will analyze how Tortle Ninja makes money with our well-known strategy, the L1 indexed farming fund.
This strategy divides our liquidity into four distinct streams, each of which ends up at one of the four farms.
WFTM-BNB, WFTM-AVAX, WFTM-ETH, and WFTM-MATIC.
These four farms generate yields in two ways:
- About 0.17% of all trading volume is added to the LP Token, as a fee to liquidity providers.
- Another quantity is given to these liquidity providers in the form of BOO emissions, as a part of a liquidity mining program.
This gives each pair the following APRs based on their performance over the last 5 days:
- WFTM-BNB, APR 20,01%
- WFTM-AVAX, APR 15,05%
- WFTM-ETH, APR 12,59%
- WFTM-MATIC, APR 11,06%
When a user deposits funds on Tortle Ninja, a vault is created or used. That vault has an embedded strategy that, every 24 hours, sells the BOO token and buys more LP tokens, creating a compound interest effect.
This magic is created by Andre Cronje on Yearn Finance years ago.
These APRs are transformed into APYs :
- WFTM-BNB, APY 22.15%
- WFTM-AVAX, APY 16.24%
- WFTM-ETH, APY 13.88%
- WFTM-MATIC, APY 11.85%
The magic of compound interest is that as you automatically buy more LPs every day, your share of the pool grows, as do your fees.
But underneath, we have the value of these tokens themselves, while these APYs only show what is gained through these vaults and farms.
If the value of any of these tokens rises, these APYs will rise parabolically; if the value of any of these tokens falls, or even if the profit of the farm turns negative, Tortle Ninja will automatically move your assets to any other coin.
The crypto markets are extremely capillary; when the market is bullish and liquidity is flowing in, these L1 assets can capture the majority of these gains. As on any indexed fund, your gains won’t be the peak, but they will be good enough.
When the market goes down, your autocompound will continue generating more LP and more tokens, so when it bounces back, you will actually have more tokens than you deposited. These strategies will not save you from market downturns, but they can quilt them better than just holding assets.
On a microbillion-dollar market, this strategy generates about a 5% daily yield, earned on a mixture of $FTM, $ETH, $MATIC, and $BNB, and it’s basically the only way you have to earn these tokens out of thin air.
And, yes, when calculated as a structured product, the real yield yields a MASSIVE vAPY of 2239.82%. This APY includes:
- Increase/decrease of price of the underlying assets.
- A 0.17 percent of all trade fees generated on the four pairs.
- The Boo emissions, autocompounded daily on the principal.
When the underlying assets go up, the compounding magic generates a huge stream of money, and if that doesn’t happen and the market crashes, don’t worry, you will be safe on stablecoins, beating the market.
About Tortle Ninja
Tortle Ninja is a no-code decentralized financial tool built to enable retail investors, fintech, and crypto enthusiasts to create combined DeFi strategies.
Tortle Ninja users can create combinations of DeFi operations by linking the nodes and defining a strategy. You can split, create a limit, stop-loss orders, and even more complex strategies.