Burrow #alpha
Once burrow is live on NEAR mainnet, it will allow an interesting pattern of investing.
Burrow liquidations minimize the discount a user pays through the game theory of getting it first by competing liquidators. Read more here: https://github.com/NearDeFi/burrowland#liquidations
Details below
So it maybe one of the best way get into the risk on positions.
But it does have some caveats: like interests paid on the collateral and borrowed assets may be different, so your staked rewards will be canceled by NEAR interests.
@mob If I am not profiting from NEAR growth, the main source of income is 11% from staking. Roughly speaking, I put stablecoin at 11%. But there are more opportunities in DeFi where i can deposit my stablecoins with such %, Then why use the Burrow?
@haenko you profit from near growth, because during liquidation you keep your near, but lose stables. The only caveat if the price retreats.
@mob just deposited 10 NEAR in Burrow beta : )
It means you'd be able to put USD* as a collateral and burrow NEAR. Then you can stake that NEAR and earn about 11% APR on it. If the price goes up, you will be liquidated and maybe going to pay 1-2% in discount on the way (which is like a fee when you buy), but if NEAR price goes down, you are not going to be liquidated, so you can increase your position more, because your collateral in USD* still keeps your value.