Advanced strategies

This page describes advanced capabilities of Levva protocol, suitable for sophisticated risk-seekers.

Leveraged strategies

The entire on-chain architecture of Levva allows for functioning of highly optimised lending protocol which allows direct and efficient borrowing of vaulted WBTC, WETH, or Stablecoins for on-chain yield and points farming. Levva lending pools control all the risk parameters associated with leveraged (collateralized) borrowing. Pools manage borrower positions, automatically liquidate them when risk thresholds are breached, automatically accrue interest rates on borrowers, and automatically redistribute accrued interest and liquidation penalties back to lenders. Creation of Levva pools is permissionless so different protocols and service providers may build non-custodial applications on top of Levva pools that empower borrowers with various leveraged farming strategies.

Supported strategies

Leveraged Farming

The following table lists attainable leveraged farming strategies and associated Levva pools.

Strategy	Asset to Borrow	Asset to Buy	Levva Pool	Explanation
1	WETH	LRT	ezETH / WETH	Farm LRT points with leverage by borrowing WETH. Farm LRT APY. Pay interest rate on WETH borrowed in return for the leveraged farming of tokens/points offered by LRT protocols.
2	Stablecoin	LRT	ezETH / USDC	The process is the same as above, but farmers here get additional market risk exposure from the LRT. This method also works for farming new stablecoins such as Ethena’s USDE.
3	WETH	PT on LRT	PT eETH / WETH	Farm implied APY offered by Pendle PT tokens. Buy PT tokens with leverage by borrowing WETH and hold them until maturity locking in the implied APY. Pay interest to Lenders.
4	Stablecoin	PT on LRT	PT eETH / USDC	The process is the same as above, but farmers here get additional market risk exposure from the LRT. This method also works for farming new stablecoins such as Ethena’s USDE.
5	LRT	PT on LRT	PT eETH / weETH	Direct leverage on Pendle AMM using LRTs. An interesting use-case for lenders of LRTs as an additional source of revenue on their restaking tokens.

Other yield strategies

Thanks to Levva's modular design, vaults are capable of calling multiple smart contracts within the same blockchain transaction using various adapters. This functionality allows to combine leveraged borrowing in Levva's pools with interaction with other protocols and introduce following strategies:

Delta neutral restaking strategy

Earning yield through funding fees on Perp DEXes and lending. Lend 50% of ETH (LRT) to the Vault, use other 50% to short 1xPERP on ETH. Earn Lending APY, LRT APY and a funding rate from the PERP short, while maintaining market neutral position.

Cross-lending market neutral strategy

Cross-lending market neutral strategy consists of UNI v3/v4 Token/WETH position and Token borrow position on Levva either directly against the UNI LP or against WETH to reduce the exposure to the Token.

P2P repo loans and swaps

Levva smart-contracts allow to tokenize total return, volatility, and interest rate swaps. These contracts rely on off-chain price feeds between two counterparties and automatically handle margining and payouts. Additionally Levva allows counterprties to engage in repo agreements with pre-agreed assets, interests, and haircuts.