Many were looking forward to the launch of Alpha Homora v2 and the accompanying yield farming. However, a loophole caused an exploit to occur. That loophole is now closed.
In a post-mortem, Alpha Finance Lab published the details of the exploit that impacted Alpha Homora v2. An attacker exploited the system through the use of complex transactions, which included flash loans. However, the platform stresses that the debt incurred is not between the users and Alpha Homora v2 but rather between Alpha Homora v2 and Cream v2 due to their integration in a protocol-to-protocol lending manner. All users’ funds are safe.
As of now, borrowing is fully paused. The platform notes, “Lenders can still lend. Leveraged yield farmers can still repay their debt, add collateral, and close the positions.” Liquidity mining activities are still ongoing. The entire platform, having already gone through two audits, will go through a third audit.
Yield Farming Details
In a tweet from late January, Alpha Homora v2, which is part of Alpha Finance Lab, published some details about its latest service: yield farming. It read, “To prepare for #AlphaHomoraV2 launch that is around the corner, let’s get comfortable with how Alpha Homora v2 works from yield farmers’ perspectives.”
The company went on to explain how this service works from yield farmers’ perspectives. According to a blog post, those engaged in yield farming “can open leveraged yield farming positions of liquidity pools that are on Curve, Balancer, SushiSwap, and Uniswap.” If they choose to, they can take leverage of altcoins like ETH, stablecoins, or other assets. They can “open up to 9x leveraged yield farming positions for selected pools.” All the positions can be easily managed.
At the same time, the service does not offer auto reinvestment. Users are also allowed to supply just 1 token.
How Can the Service Be Used?
To start using the service, you need to follow four key steps:
- Select a pool
- Supply liquidity
- Select leverage and how much of each asset you want to borrow
- Confirm strategy
A user can select a pool by going to the Dashboard page.
Then select supply liquidity. Note that yield farmers do not necessarily have to possess the same value of both tokens. The company promises that the process will be automatic and that it will “optimally swap the assets to arrive at the equal value of both tokens before taking care of the yield farming process for our users.”
Next select leverage and assets you want to borrow. Alpha Homora v2 uses the concept of collateral and borrow credit. This is done so that users can take leverage on several assets simultaneously. According to the company, the collateral credit and borrowing credit of an asset are correlated with the volatility of the asset price.
“If an asset is volatile, the collateral credit will be low and the borrowing credit will be high. With this mechanism, Alpha Homora v2 can set parameters according to the volatility of each asset and set different buffer parameters for different assets to ensure the security of the protocol,” the company explained.
Once you have done these steps and confirmed your strategy, just relax. The company promises to take care of the yield farming process for you.
Managing positions is easy, according to Alpha Homora v2. Whenever you want to add, remove, harvest, and close, users can go to the Your Positions page and complete the action.
Alpha Homora v2 is part of Alpha Finance Lab, which is an ecosystem of DeFi products that seeks to ensure maximum returns for its users while minimizing downside exposure. The company is focused on catering to DeFi users by being user-friendly and offering innovative services and products.
After Alpha Homora v2 launched, some additional features were added to help those engaged in yield farming. These features include:
- Yield farmers/liquidity providers that are leveraged can now borrow more assets to re-leverage their open positions.
- Users can now view the each pool’s TVL in an easy manner, which should help them evaluate their yield farming strategy.
- Asset prices can now be easily viewed. A user can hover over their position’s debt ratio tool-tip to see the price in which their position is subject to liquidation risk. The user can also click on the Asset Price page to see the current asset prices.
New security features are being added to the platform. After a number of internal reviews are done, as well as another audit, then the team will relaunch Alpha Homora v2 with borrowing re-enabled, along with more lending assets and additional leveraged pools.
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