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Sharpe Magnum: A new protocol that allows for leverage trading on LSD.

Leo

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Providing higher APY for users who stake their assets.

Original author: Sharpe Labs

Translated by: Leo, BlockBeats

Pledging is an important part of the DeFi ecosystem, allowing users to earn passive income by verifying transactions and protecting network security. Undoubtedly, with the explosion of liquidity pledge protocols such as Lido, Stader, and Rocketpool, many users are dissatisfied with the status quo and are beginning to look for ways to increase their pledge yield.

Sharpe Magnum is a new protocol in the DeFi LSD track, and it is also a leveraged collateral layer built on Aave, Lido, Balancer, and Aura. While maintaining the same basic premise as the largest DeFi pool, it leverages collateral assets through borrowing and lending to provide users with higher APY for their collateral assets.

Improve the APY of pledgers

Many DeFi users' main goal is to maximize their staking yield. Magnum is a staking optimizer. Traditional staking protocols require a 1:1 staking asset ratio, but Magnum leverages flash loans and lending protocols to leverage staked assets and increase staking pool capital efficiency by arbitraging the "staking-lending" interest rate differential, while still benefiting from the underlying protocol guarantees and existing staking pool deep liquidity. Therefore, users staking assets through Sharpe Magnum will receive a higher APY.

Composability

Magnum is based on the ERC-4626 standard and has composable features, which means it can be easily integrated into other protocols and applications. Users who deposit ETH will receive magETH, which can be used for various use cases in the DeFi ecosystem, further enhancing its utility, flexibility, and liquidity.

Same Guarantee and Liquidity

Sharpe Magnum is different from other staking protocols in that Magnum does not compete with the current staking pools. Instead, it expands the infrastructure and also gains liquidity to provide users with the best optimized staking rewards. This means that users can obtain the same amount of staking liquidity and underlying collateral as Lido, Stader, or other staking protocols.

Sustainable Risk Monitoring

Magnum's on-chain keeper continuously monitors the risk of its position, and in the event of potential loss, the keeper will automatically use emergency measures to "deleverage".

Future Development

In the future, Sharpe Magnum will launch a MATIC staking vault - receiving MagMATIC.

Multi-strategy deployment on Morpho, Aave v3, and Euler, targeting cbETH and rETH for ETH vaults, and MATICx and stMATIC for MATIC vaults, smoothly leverages and deploys on different sources of income to increase APY and reduce single-point dependencies.

In short, Magnum is the best way to stake in DeFi. Instead of directly using your favorite staking pools such as Lido and Stader, it is better to use Magnum.