Advanced Yield on Avalanche with Definitive + BENQI

DEFINITIVE.

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DefinitiveFi

3 min readJan 11, 2024

Advanced yield strategies for Avalanche and BENQI communities

tl;dr

Definitive is live on Avalanche via strategic partnership with BENQI, Avalanche chain’s leading protocol by TVL. Definitive’s advanced strategies combine BENQI’s lending markets and liquid staked token sAVAX with our superior execution, detailed reporting, and robust risk management capabilities. All strategies are accessible today at benqi.definitive.fi.

Context

Today, Avalanche possesses one of the largest DeFi ecosystems with blazing fast transactions, low fees, $850M+ in TVL, and ~$80M in daily volume (per DefiLlama).

BENQI is the largest DeFi protocol on Avalanche by TVL and offers a suite of decentralized finance protocols: BENQI Markets and BENQI Liquid Staking.

BENQI Markets enables users to effortlessly lend, borrow, and earn interest with their digital assets. Depositors provide loan liquidity to the protocol to earn yield while borrowers can access over-collateralized leverage.
BENQI Liquid Staking is an Avalanche validator staking solution that tokenizes staked AVAX as fungible sAVAX. With sAVAX, users are given the ability to swap or collateralize the yield-bearing asset within DeFi applications.

Definitive’s integration with BENQI introduces multiple automated yield strategies by orchestrating BENQI Markets and BENQI Liquid Staking positions for maximized yields.

What’s Launching?

sAVAX Hyperstaking Strategy

Strategy Overview: Arbitrage the delta between the sAVAX APR and the BENQI AVAX borrow rate to 3x–5x the LST yield. Find an in-depth overview of Hyperstaking here.
Assets Supported: sAVAX, AVAX, WAVAX
Source of yield: Rate spread arbitrage (real yield) on AaveV3 and BENQI
Estimated Yield: ~10% — 20% APR

BENQI Lending Strategy

Strategy Overview: Supply assets to BENQI markets and utilize Definitive’s automation to compound rewards efficiently.
Assets Supported: sAVAX, AVAX, USDC, USDT, DAI, BTC.b, WBTC, WETH, LINK
Source of yield: Interest through borrow demand with additional QI and AVAX token incentives (real yield + emissions)
Estimated Yield: ~3% — 9% APR

The Definitive Edge

Definitive’s proprietary automation and risk-management tooling reinforce every BENQI integrated strategy via real-time monitors such as:

Leverage Loan-To-Value (LTV): Ensures leverage stays within a target range and automatically rebalances the position when that range is breached, preventing any liquidation from occurring while maximizing yield for the clients risk configuration.
Relative Liquidity: A risk-control feature limiting the percentage of liquidity provided to a protocol pool. Ensures a client never becomes a large percentage of the pool by dynamically scaling position size as protocol usage evolves.

BENQI Partnership Benefits

Avalanche Expansion: This partnership marks Definitive’s expansion into Avalanche, a pioneer ecosystem for DeFi. Definitive’s users can access yield opportunities on popular assets such as sAVAX and AVAX. Expect more Avalanche protocol integrations and assets soon!
Enhanced Liquidity and Market Depth: Definitive’s integration brings an influx of institutional users to BENQI Markets and BENQI Liquid Staking, deepening liquidity for lending and growing market share for the sAVAX liquid staked token.
Access to Advanced Strategies: Avalanche and BENQI users can now optimize their yields and expand their investment capabilities through sophisticated strategies on Definitive’s institutional-grade platform.

By partnering with BENQI, the leading Avalanche DeFi protocol, Definitive unlocks new yield-generating possibilities for our institutional clients and the wider Avalanche community.

About Definitive

Definitive is an execution platform and API for DeFi, offering non-custodial smart contracts and automation services across many DeFi protocols. Definitive’s smart contracts and proprietary off-chain engines work in tandem to streamline DeFi execution for end users, from complex yield strategies to high frequency trading algorithms.

Definitive Platform | Telegram | Twitter | Documentation

About BENQI

BENQI is a suite of decentralized finance protocols built on Avalanche, consisting of the BENQI Markets, BENQI Liquid Staking and Ignite.