Strategy alpha leak:

Right now using @RulerProtocol and @RariCapital, someone could lock in almost 40 WETH to:
-Maintain full upside exposure to 40 WETH
-Limit WETH downside to about -20% for the month of April (ATM)
-No liquidation risk
-Effectively no fees beyond gas!

How?

Step 1: Deposit WETH into Sifu's Degen pool @RulerProtocol and borrow DAI, as seen in the image. Note the Annualized Interest Rate at ~21% for 40 WETH.

All of these interest rates lock in for you upon the borrow transaction, and you have no risk of liquidation as long as you pay back your loan before expiry (April 30th 00:00 UTC). If you fail to do this, you forfeit all of your collateral.

Step 2: Identify a safe place to deposit & earn yield on your DAI, preferably at an equal/higher yield than the borrow rate. @RariCapital has a few promising places, including their Stable Yield Agg and @Tetranode's RGT Fuse pool. Note that these yields do fluctuate w/ time.

As long as your deposited DAI earns equivalent or more yield APY than your locked-in borrow interest rate, you are not having to effectively pay anything but gas throughout this entire process!

Step 3: Near April 30th - if WETH is still worth more than $1650 per token, you can pay back your loan using the borrowed DAI and its yield to receive all of your collateral WETH back.

If WETH dumped and is now worth <$1650, it's in your best interest to let the loan default and keep the borrowed DAI - otherwise you'd have to pay back more DAI than what the underlying WETH is worth!

Some notes: If the yield-earning DAI that you borrowed doesn't yield as much as your locked in interest rate, you'll still have to cover the difference if you want your collateral back. You're also exposed to SC risk of anything you interact with. Don't forget to calc gas fees.

The numbers I posted above for WETH borrowing on @RulerProtocol will change any time a lender/borrower enters or leaves the pool, so while you may be able to lock in your rates, you have to beat others to it!

It may actually be strategically better to not deposit DAI for yield, depending on anticipated gas fees. However, this also serves as a great example of what the future could look like at Ruler with more liquidity and volume!

Finally, everything that I've shared are my own findings, and are not guaranteed to be correct. Please DYOR before you act in some fashion and remember that this thread is not meant to be financial advice - you could still experience problems that I'm not aware of!

h/t Ruler Team @chefcoverage @crypto_pumpkin @kryptocucumber @jurad0x @Teddy9423 @DeFi_Ted Twitterless Sifu

cc @transmissions11 @jai_bhavnani @JackLipstone et al involved with Rari