Overnight on Arrakis: The Trio of Delta-Neutral, Concentrated Liquidity, & Liquidity Management Solutions

Delta Neutral Strategies: What makes it Unique

Since its inception, Overnight’s Delta-Neutral Strategies boast of offering 10–25% APY on USDC for users of delta-neutral strategies for over 4 months. Bear or bull, the strategy effectively negates exposure to market volatility through the magic of delta-neutral.

The Mechanics

The Delta-Neutral strategy utilizes an AMM (Uni v3), a Lending Protocol (AAVE), and a liquidity management solution (Arrakis). This is a perfect trio with each complimenting the other.

Arrakis Liquidity Pool on Velodrome

Additionally, to make the ETS more accessible, Overnight has launched a self-bribing USD+/ETS v3 Arrakis Pool on Velodrome. Such a liquidity pool boasts of both underlying assets being Yield-Bearing and the yields from the two assets are used to bribe veVELO holders (governance token holders) in favor of voting for the USD+/ETS v3 Arrakis Pool. This means that the pool adopts an ‘anti-dilution’ methodology whereby a surge of liquidity entering into the pool doesn’t instantaneously dilute the APRs; an increase in TVL corresponds to more yields and hence, equates to greater bribes to sustain emissions. In short, the TVL complements APRs by indirectly accruing benefits to LPs.

A Trio for the Better: How to get started

Users looking to get started with Overnight’s Arrakis strategy can buy the token via Velodrome as explained in the image below. Simply acquire USD+ (through Overnight’s dApp or on Velodrome itself) and then swap for ‘ETS v3 Arks.’ Users looking to amplify their rewards from the ETS can partake in the USD+/ETS v3 Arrakis Stable Pool and enjoy additional yields.

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