Kava Earn Strategy | APY Earnings Between 35% & 45% using BUSD with Kava’s DeFi Products

2 min read

With Kava Lend, it’s easy to leverage any asset supported by Kava Mint. The guide below will walk you through depositing BUSD, supplying BUSD to Mint to obtain USDX, supplying USDX to Lend, and then reverse the process smoothly.

APY earnings can be expected to range between 35% and 45%, and supplying stablecoin assets to Mint involves very little risk. For USDX suppliers to Lend, there is little risk.

Workflow for applying the BUSD Mint x Lend Earn Strategy

Getting Started

The following steps will guide you in how to quickly set up and reverse the BUSD Mint to Lend strategy.

1. Deposit BUSD (BEP-2) to Kava

To take advantage of the Kava Earn strategy, you must first obtain supported assets — Kava Currently supports BEP-2 Binance assets such as BNB, BUSD, BTCB, and XRPB.

Binance Chain uses the BEP-2 token standard, while Binance Smart Chain (BSC) uses the BEP-20 standard. The BNB token is necessary for processing transactions with both. Therefore, you’ll need to use some BNB to transact on either chain.

The BEP-2 and BEP-20 token standards are fully compatible, and users can transfer BEP-2 Assets between BSC and Binance Chain via the Trust Wallet.

In Trust Wallet, click on your BUSD asset, then hit “Swap” and exchange Bep2 ↔ Bep20

To deposit assets, head to the Balances page in the Kava app.

2. Supply BUSD to Kava Mint

Now that you have deposited your BUSD to the Kava chain, you can use BUSD as collateral to borrow USDX at up to 99.01% Loan to Value (LTV) with Kava Mint.

What makes stablecoins special on Kava Mint is their fixed USD$1.00 peg, and users can borrow 99% of the value supplied. That means Mint users can take out loans against crypto-asset collateral at a 99.01% LTV ratio to obtain USDX without paying trade fees.

Kava Mint is designed in such a way to minimize risk for users. Stablecoins like BUSD have fixed asset prices to minimize price fluctuation risks, and it would take a multi-day de-pegging of BUSD to put a user’s position at risk.

In addition, users can obtain USDX without exposure to USDX price changes because they repay the USDX value of the loan regardless of the price of USDX.

On Kava Mint, simply click “Supply & Borrow” to open a CDP. To close, Repay the USDX loan.

Click here to enter Kava Mint.

3. Supply USDX to Lend

When you have successfully borrowed USDX from Kava Mint, you can then supply that USDX to Kava Lend and start earning stable returns on the supplied asset.

Users can earn 35%+ APY with USDX on Lend because USDX receives extra incentives compared to most other assets for being the native stablecoin of Kava. And importantly, for USDX suppliers, there is no liquidation risk on Kava Lend.

Simply supply USDX to Lend. If borrowing on Lend too, repay borrowed assets before withdrawing.

Click here to access Kava Lend.

4. Reversing the Kava Earn Strategy

To back out of the Kava Earn strategy is simple:

  1. Withdraw your USDX from Lend
  2. Repay that USDX to Mint
  3. Reclaim the full amount of BUSD that you originally supplied
Workflow for reversing the BUSD Mint x Lend Earn Strategy

And that’s it! You know everything you need to use this simple yet powerful strategy to earn on Kava.

Introducing Kava Earn…

Alternatively, you can simply supply or withdraw BUSD in Kava Earn and take advantage of the strategy outlined above. Kava Earn is a new feature to simplify earning strategies powered by the Kava Network, with the first edition being the BUSD Mint to Lend strategy.

Ditch the steps and simply supply & earn.

…Coming Soon

About Kava

Kava (kava.io) is a secure, lightning-fast Layer-1 blockchain that combines the developer power of Ethereum with the speed and interoperability of Cosmos in a single, scalable network.


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