Achive higher yield across 4 lending protocol (Compound, AaveV1, AaveV2, DyDx) with Idle finance
Today, Layer2.finance user earn yield by depositing token to single strategy(e.g. Compound, AaveV2, Curve3Pool strategy). As mentioned in CIP-3 by frankzhu, it is hassle for Layer2.finance user to manually redistribute balance to another strategy with higher yield.
So I propose a strategy to automate rebalance across 4 lending protocol (Compound, AaveV1, AaveV2, DyDx) for optimize interest rate profitability and get the higher yield by integrating Idle finace to layer2.finance. In addition, Layer2.finance strategy does not support AaveV1 and DyDx now. So Layer2.finance user can get an opportunity of eaning yield by lending to AaveV1 and DyDx.
Currently, Idle finance support two different allocation strategies:
Best-Yield: this strategy combines multiple money markets to automatically provide the highest interest rates, beating the best traditional offerings across interest-bearing tokens and DeFi protocols.
Risk-adjusted: this strategy automatically changes the asset allocation in order to find the optimal mix between risk scores and yield.
I propose layer2.finance support two allocation strategies for user can choose best interest rate or best risk/yield allocation.
Deposit supply token(e.g. DAI, USDT) into Idle Lending Pool and mint iToken(e.g. idleDAI, idleUSDC) correspoing to deposit token amount.
1. Withdraw underlying token(e.g. DAI, USDT) from Idle Lending Pool by redeeming iToken(e.g. idleDAI, idleUSDC).
2. Transfer withdrawn token to rollup chain contract.
1. Claim IDLE (Idle finance governance token) which distributed by liquidity mining.
2. Swap IDLE token for supply token (e.g. DAI, USDT) via sushiswap.
3. Deposit obtained token by swap into idle Lending Pool and mint iToken correspoding to deposit token amount.
- Support this proposal to add new Idle finance strategy
- Do not support this proposal to add new Idle finance strategy
 Idle finance developer docs (https://developers.idle.finance/)