Costly Mistakes | DeFi Journey #21

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This week was probably the worst week in my DeFi journey as I suffered many losses. Crypto isn't for the faint-hearted, but I'm also to blame for some poor decisions that cost me dearly. Sometimes you learn the hard way that market orders and thin liquidity don't mix well. As for DeFi Journey, I'm sitting at an average of 7% APR on just over $6.5K deposited.

Week 20 tldr;

• Yields farmed: +$12.62
• New positions entered: 1
• Positions exited: 2

Portfolio Overview

This week felt like I was chopping and changing constantly. Stables are becoming the new hot thing in the crypto market as I reported in my SPS technical analysis this week that the U.S government has signed in the GENIUS Act. The problem is that frequent moves can lead to costly mistakes, which I learned the hard way this week. I moved funds I had in Hive HBD but made a stupid error - I sold at market order price instead of limit price. Due to thin liquidity, I lost a significant chunk of HBD value. Some people on the Hive blockchain got really cheap HBD thanks to my stupidity. A very costly mistake and it took forever for my to build up that HBD stack, but such is life. Continuing with the theme of chopping and changing; this week I exited two positions that weren't performing spectacularly. The effort wasn't worth the squeeze so I exited and hopefully moved the funds into better opportunities.

Recap of Exited Positions

CL1-USDC/eUSD - Vfat, Base

This farm only lasted one day as it kept getting knocked out of range, and I didn't want to manage it that closely. Vfat recommends that positions be set to auto-rebalance only with $2K or more, which made this position unsuitable for my current strategy.

• Final Yield: $0.75
• Total Rewards: $0.75
• Total Deposits: $625.89
• Withdrawal Value: $625.24
• P&L: $0.10

USDT/USD1 - Euler Finance, BSC

I wanted to consolidate these funds into the Pendle LP I already had open, so I exited this position after just two days. While it was profitable, the returns weren't compelling enough to justify keeping funds spread across so many small positions.

• Final Yield: $1.44
• Total Rewards: $1.44
• Total Deposits: $730.26
• Withdrawal Value: $731.70
• P&L: $2.88

Yield Farming Strategies

oUSDT-USDC - ExtraFI, Base Chain

I deposited an additional $625.24 into this leveraged farming position this week, and it earned the majority of my yield with $8.49 in returns. This three-times leveraged position continues to be one of my better performers.

• Yield Rewards: $8.49
• Total Deposits: $2,104.30
• Current Value: $2,112.79
• Debt Ratio: 66.67%
• Leverage: 3x
• Price Difference (Inc. Fees): $8.49 (0.40%)

SyrupUSDC/USDC - Kamino Finance, Solana

This yield farming position on Solana yielded $0.76 in fees this week. The position remains stable at 3x leverage with a manageable debt ratio of 66.11%. While the returns aren't spectacular, the consistency makes it worth maintaining.

• Yield Rewards: $0.76
• Total Deposits: $825.60
• Current Value: $826.25
• Debt Ratio: 66.11%
• Leverage: 3x
• Price Difference (Inc. Fees): $1.41 (0.17%)

sUSDX - Pendle Finance, Binance Smart Chain (non-leveraged)

This position was boosted with funds from closing the Euler Finance position on BSC, making it my second-biggest position. The fees this week weren't spectacular at $0.31, but the LP position has increased in value, which isn't uncommon as Pendle Finance has been on a tear lately. This position is also farming USDX airdrop points, and I'm up to 14K S-Points. You never with airdrops whether they will turn into something, but will continue to farm till the LP matures on 1 Sept 2025.

• Yield Rewards: $0.31
• Total Deposits: $2,101.65
• Current Value: $2,109.92
• Price Difference (Inc. Fees): $8.58 (0.41%)

USDC/USDT0 - Euler Finance, Arbitrum One

This is my new position opened with the HBD funds, and it's the highest leveraged position at almost 9x! The price fluctuations have been wild this week, and I'm closely watching the liquidation factor as this is an extremely high-risk position. The debt ratio of 88.88% means I'm walking a tightrope here.

• Yield Rewards: $0.87
• Total Deposits: $1,478.05
• Current Value: $1,482.20
• Debt Ratio: 88.88%
• Leverage: 8.98x
• Price Difference (Inc. Fees): $5.02 (0.34%)

Concluding Thoughts

This week showed improvement in yields compared to last week, but not by much. I sometimes wonder if it would be worthwhile to consolidate all positions into one stable 10% yield farm on Pendle Finance instead of managing multiple smaller positions across different chains. The positive aspect is having positions diversified across many platforms and chains, reducing platform risk. However, the Arbitrum leveraged position makes me worry due to its extremely high-risk leverage.

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Thank you for reading, and hope you have a good rest of the day!

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