Grape Finance | Full Guide & My Best Strategies To Print Money
What if we could finally make some “sustainable” and predictable passive income from DeFi?
Well, Grape Finance has been doing it for around 6 months now. You know that months in DeFi are more like years, so for a project that is paying daily rewards to be around 6 months later deserves some respect.
I present you with a quick guide and the strategies that I find have worked the best for me.
So, what is Grape Finance?
Grape Finance is an algorithmic stablecoin protocol pegged 1:1 to MIM on Avalanche.
That means, if $MIM is worth $1 then $GRAPE should also be worth $1.
Other than $GRAPE, they also have $WINE tokens which represent ownership in the protocol with a maximum of 50,001 tokens in existence. The more TVL (Total Value Locked) the protocol has the more expensive $WINE should be (that’s my thought).
How do they make the price maintain its peg?
Quick answer: Supply and demand.
Long answer: Price stability is maintained through various mechanisms like buying, selling, gaming, burning, and bonding.
If it goes under peg, they burn $GRAPE, if it goes way too high they increase supply.
An example: If $GRAPE goes to 0.80c. Grape Finance utilizes GBOND. GBONDs are bought by burning $GRAPE and are later redeemed for an extra $GRAPE when TWAP (Time-weighted Average Price) is greater than 1.1
Yeah cool, but how do we make money…
Short and obvious answer: Stake or farm to earn $GRAPE or $WINE, then sell these tokens for a profit.
Starting with the Vineyard;
Staking: Locking your tokens for a period of time, to then later receive a reward.
Here you can single stake or dual stake by providing liquidity.
Single stake means you only need one token. Dual staking or farming means you need a 1:1 ratio of two tokens.
One of the pools is a MIM-GRAPE pair. That means if you have $50 worth of MIM you should also have $50 worth of GRAPE. Be aware that a pair balance itself so if one token is worth more than the other then it will decrease or increase one of them in order to achieve the “perfect” 1:1 ratio.
Here are some of the pools on the Vineyard:
How to read them;
- At the top, you can see which pair or token they require.
- Next is the token that you will be earning.
- Followed by the APR (Reward per year)
Note that the APR fluctuates, the more people the pool has the smaller each share becomes so APR has to go down to be distributed more evenly.
Nodes
Unlike farming nodes are locked staking because once you purchase one, your initial funds are locked and gone.
Rewards are solely on that purchase, let me explain myself.
Let’s say you buy 1 $Grape node for 50 $Grape tokens. And you start earning an average of 1.5% daily ROI, which means you will be making 50 x 1.5% = 0.75 $Grape tokens per day.
Why nodes and not just farming?
Sometimes the daily ROI % is higher on nodes, plus most nodes provide single staking which is easier because you only need one token. Also, nodes are somewhat better for the protocol longevity.
Grape Nodes
- 50 $Grape tokens to purchase a node.
There is a cap of 500% on each node. That means the most you will make from them is 250 $grape tokens, which is still pretty amazing. If you spend $50 and the price remains somewhat stable you should be able to get back over the long run around $250.
Your initial 50 tokens get locked forever.
At the moment daily ROI is hovering between 1–1.5%.
Wine Nodes
0.5 $Wine token to purchase a node. Wine Nodes pays out up to 2.5 $Wine tokens then ends because of the cap.
The daily ROI is way much lower, at around 0.20%. Also because the token is an ownership token and not an algorithmic stablecoin the price fluctuates on a daily basis by a lot. You might see it at $180 and $250 the next day.
GRAPE-MIM SWAPSICLE
A node that consists of a liquidity pair Grape and MIM, created on the Swapsicle protocol.
It is just a pool like I explained above but with a higher APR plus your initial is locked.
The big difference is that from time to time you will get airdropped some swapsicle tokens. It is not a crazy amount, so don’t you think you will get rich from this. Probably under $1 worth of airdrops per week.
Strategies
This is my strategy and what has worked for me. I like simplicity so I go with $Grape nodes.
- Price is more stable
- I more or less know how much I will be making per day
Then the $Grape that I make from these nodes I can either compound them into another one or I go to magik.farm which gives me an extra 0.20% autocompounding on $Grape.
So I have then 3 options:
1- Cash out my $Grape
Choose a timeframe and sell your tokens for a profit. I usually do it once a week, on Sundays and I track it using my spreadsheet. https://defichronicles.gumroad.com/l/xwwln
2- Save and then compound into another node
If I want to increase $Grape I am making a good thing to do is to save my weekly earnings and whenever I have 50 tokens I use them to create another node. The good thing is that I am investing more money in the protocol without the need me using my cash, it is just straight rewards.
3- Put it to work into magik.farm to continue to increase my holdings
Maybe I have some $Grape laying around but the price is below peg or I don’t want to sell them or locked it into another node. Then I can go to magik.farm, use the autocompounder which pays 0.20%, and stake it there.
The good thing is that I am able to withdraw back my investment whenever I want and sell them. Magik.farm doesn’t lock your investments like nodes (that’s why the APR is also much lower).
All of them are valid options depending on what I am trying to achieve.
- If I want to get my investment as quick as possible then option 1.
- If I want to increase my cash flow then option 2.
- If I want to keep my $Grape liquid but don't really want to sell them immediately then magik.farm is the way to go.
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Disclaimer: This is not financial advice, I am just a guy with a laptop sharing his opinions and experience. This is for entertainment purposes only. Always Do your own research before investing.
