i started to participate in the iBTC stability pool this week.
i put in 0,006032 iBTC current balance is 0,005892 iBTC with a price of 114336 ada / iBTC I lost 16,01 ada due to liquidations but my reward is only showing 15.8 ada, making it a 0.2 ada loss.
long story short: how can there be a 17% ada apr when im getting less ada rewards than what the IBTC is worth that I loose.
Is my calculation wrong? i guess there is some slippage due to price changes but i didnt expect this.
anyway i will let it run for some more time maybe the indy returns will make up for the ada loss.
im just curius if i did my p/l calculation correctly. so anyone willing to share their experience is wellcome.
The APR you see is related to Indigo protocol. The iBTC price you referred to is the price at a dex (minswap/wingriders/etc). And those are totally different things. When a liquidation happens is at the real ADA/BTC price (provided by Chailink oracle) that counts within Indigo. The price right now is around 106000 ADA/iBTC. So the stability pool burned 0.000140 of your iBTC and gave you back 15.8 ADA. But the cost of those 0.000140 iBTC would be 14.84 ADA. So you are in a profit of a bit less than 1 ADA.
The prices we see in the different dex are higher than real value of ADA/BTC because the demand for iBTC is higher than current supply. So, someone who minted the iBTC are not willing to sell it without a premium because they know there are people who want to buy iBTC without opening a CDP. Although you paid 114336 ADA for that iBTC, it doesn’t mean that’s the price you should count when using the stability pool. Remember, your iBTC will be used to burn the CDP of someone with a undercollateralized iBTC position within Indigo, and the oracle price (the one that counts for Indigo purposes) is not minswap/wingriders/VyFi/Muesli price.
thx for clarifing makes sense
Plus you get Indy rewards too.