$ETH has been pumping and yields in AMMs are peaking this summer! Here is how to earn 18% APY on replicated spot $ETH exposure using @GammaSwapLabs and @AerodromeFi 👇

An overview of the strategy 1️⃣ Provide liquidity in ETH/USDC with a moderate wide range +-30% 2️⃣ Open ETH/USDC Long in GammaSwap to hedge IL 3️⃣ Earn yield on synthetic spot $ETH exposure

Starting parameters ✅ $3,712 ETH price with range ~ +-30% ($2,590 to $4,825) ✅ LP 1 ETH worth total (.424 ETH, 2135 USDC) ✅ Deposit 693 USDC as collateral in GS ETH/USDC Long

How did we get these values? By using the IL hedge spreadsheet Add the relevant inputs in orange: Price, GS Borrow APR, LP Supply APY, Exit Price (current price for now), Days Open, LP Deposit Amt (ETH), LP Lower Price and LP Upper price.

Price - Current price of $ETH Borrow APR - The Borrow APR in GammaSwap ETH/USDC pool LP Supply APY - Yield based on your range Exit Price - The price you close at. Affects P/L APY Days Open - How long you plan to hold. Higher days open = lower LTV.

LP Deposit Amt (ETH) - Total LP deposit in ETH terms LP Lower Price - Lower price of range LP Upper Price - Upper price of range Now for the outputs in light grey 👇

P/L APY - Your net APY for the synthetic ETH spot exposure. Depends on exit price Loan Amt (USDC) - The notional long position in $ Deposit USDC - USDC to open long LTV - Your opening LTV in the long ETH Deposit - Initial ETH in LP USDC Deposit - Initial USDC in LP

Leverage Multiplier - How leveraged the range is compared to a full range LP position Deleveraged APY - Your APY if the position was full range Ok now we have all the information we need to hedge IL and get synthetic exposure to ETH! Let's start entering the positions.

Deposit into the Aerodrome Slipstream Concentrated Volatile 100 ETH/USDC pool.

We entered into a range of 2570 - 4778 with a .42 ETH deposit and 2140 USDC deposit. Notice this isn't exactly the values we have from the sheet, just try and get close. Prices might change slightly + tick width can affect this. The wider you are the less exact you have to be.

Once again no need to be exact just get as close as possible. Also notice our opening cost for the position was -0.51% so we get paid to open the position! This is not always the case though and usually you incur slippage and fees to open a position. Be wary of this!

If you approach the end of the range, make sure to rebalance. If you go out of range, the hedge will no longer work. The LP position will no longer earn yield and there will be no more rebalancing of tokens in the pair since you will be fully in ETH or USDC.

That's it! If you have any questions, you can ask us in the discord