This guide covers integration with major DeFi lending protocols including Compound, MakerDAO, and other lending platforms. These protocols enable automated borrowing, lending, and yield farming strategies with algorithmic interest rates and collateralized positions.
from pt_exchanges import CompoundExchange
import web3
from web3 import Web3
import json
import time
# Compound Protocol Configuration
COMPOUND_CONFIG = {
'comptroller': '0x3d9819210A31b4961b30EF54bE2aeD79B9c9Cd3B', # Mainnet
'price_oracle': '0x046728da7cb8272284238bD3e47909823d63A58D',
'compound_lens': '0xd513d22422a3062Bd342Ae374b4b9c20E0a9a074',
# cToken contracts
'ceth': '0x4Ddc2D193948926D02f9B1fE9e1daa0718270ED5', # cEther
'cusdc': '0x39AA39c021dfbaE8faC545936693aC917d5E7563', # cUSDC
'cdai': '0x5d3a536E4D6DbD6114cc1Ead35777bAB948E3643', # cDAI
'cusdt': '0xf650C3d88D12dB855b8bf7D11Be6C55A4e07dCC9', # cUSDT
'cwbtc': '0xC11b1268C1A384e55C48c2391d8d480264A3A7F4', # cWBTC
'ccomp': '0x70e36f6BF80a52b3B46b3aF8e106CC0ed743E8e4', # cCOMP
# Underlying tokens
'usdc': '0xA0b86a33E6441E6C9CD9F00Da6F75e2BB4fc4400',
'dai': '0x6B175474E89094C44Da98b954EedeAC495271d0F',
'usdt': '0xdAC17F958D2ee523a2206206994597C13D831ec7',
'wbtc': '0x2260FAC5E5542a773Aa44fBCfeDf7C193bc2C599',
'comp': '0xc00e94Cb662C3520282E6f5717214004A7f26888'
}
class CompoundExchange:
def __init__(self, config):
self.web3 = Web3(Web3.HTTPProvider(config['rpc_url']))
self.wallet_address = config['wallet_address']
self.private_key = config['private_key']
# Load ABIs
self.comptroller_abi = self.load_abi('comptroller')
self.ctoken_abi = self.load_abi('ctoken')
self.erc20_abi = self.load_abi('erc20')
# Initialize contracts
self.comptroller = self.web3.eth.contract(
address=COMPOUND_CONFIG['comptroller'],
abi=self.comptroller_abi
)
self.ctoken_contracts = {}
for name, address in COMPOUND_CONFIG.items():
if name.startswith('c') and len(address) == 42:
self.ctoken_contracts[name] = self.web3.eth.contract(
address=address,
abi=self.ctoken_abi
)
def get_market_info(self, ctoken_symbol='cusdc'):
"""Get comprehensive market information for a cToken"""
ctoken = self.ctoken_contracts[ctoken_symbol]
# Get basic market data
supply_rate = ctoken.functions.supplyRatePerBlock().call()
borrow_rate = ctoken.functions.borrowRatePerBlock().call()
cash = ctoken.functions.getCash().call()
total_borrows = ctoken.functions.totalBorrows().call()
total_reserves = ctoken.functions.totalReserves().call()
total_supply = ctoken.functions.totalSupply().call()
exchange_rate = ctoken.functions.exchangeRateStored().call()
# Convert to APY (blocks per year ~= 2,102,400)
blocks_per_year = 2102400
supply_apy = ((supply_rate / 1e18) * blocks_per_year) * 100
borrow_apy = ((borrow_rate / 1e18) * blocks_per_year) * 100
# Get collateral factor
market_info = self.comptroller.functions.markets(ctoken.address).call()
collateral_factor = market_info[1] / 1e18 # Convert from mantissa
return {
'symbol': ctoken_symbol,
'supply_apy': supply_apy,
'borrow_apy': borrow_apy,
'utilization_rate': (total_borrows / (cash + total_borrows)) * 100 if (cash + total_borrows) > 0 else 0,
'total_supply_usd': self.convert_to_usd(total_supply, ctoken_symbol),
'total_borrows_usd': self.convert_to_usd(total_borrows, ctoken_symbol),
'cash_usd': self.convert_to_usd(cash, ctoken_symbol),
'collateral_factor': collateral_factor,
'exchange_rate': exchange_rate / 1e28, # Convert to readable format
'last_updated': int(time.time())
}
def supply_asset(self, token_symbol, amount):
"""Supply assets to Compound for lending"""
ctoken_symbol = f'c{token_symbol.lower()}'
if ctoken_symbol not in self.ctoken_contracts:
raise ValueError(f"Unsupported token: {token_symbol}")
ctoken = self.ctoken_contracts[ctoken_symbol]
if token_symbol.upper() == 'ETH':
# Supply ETH directly
tx_data = {
'from': self.wallet_address,
'value': self.web3.to_wei(amount, 'ether'),
'gas': 200000,
'gasPrice': self.web3.to_wei('20', 'gwei')
}
transaction = ctoken.functions.mint().build_transaction(tx_data)
else:
# Supply ERC20 token
token_address = COMPOUND_CONFIG[token_symbol.lower()]
token_contract = self.web3.eth.contract(
address=token_address,
abi=self.erc20_abi
)
# Check allowance
allowance = token_contract.functions.allowance(
self.wallet_address,
ctoken.address
).call()
token_amount = int(amount * 10**18) # Assume 18 decimals for simplicity
if allowance < token_amount:
# Approve spending
approve_tx = token_contract.functions.approve(
ctoken.address,
token_amount
).build_transaction({
'from': self.wallet_address,
'gas': 100000,
'gasPrice': self.web3.to_wei('20', 'gwei'),
'nonce': self.web3.eth.get_transaction_count(self.wallet_address)
})
signed_approve = self.web3.eth.account.sign_transaction(approve_tx, self.private_key)
approve_hash = self.web3.eth.send_raw_transaction(signed_approve.rawTransaction)
print(f"Approval transaction: {approve_hash.hex()}")
# Wait for approval confirmation
self.web3.eth.wait_for_transaction_receipt(approve_hash)
# Supply tokens
transaction = ctoken.functions.mint(token_amount).build_transaction({
'from': self.wallet_address,
'gas': 200000,
'gasPrice': self.web3.to_wei('20', 'gwei'),
'nonce': self.web3.eth.get_transaction_count(self.wallet_address)
})
# Sign and send transaction
signed_tx = self.web3.eth.account.sign_transaction(transaction, self.private_key)
tx_hash = self.web3.eth.send_raw_transaction(signed_tx.rawTransaction)
print(f"Supply transaction: {tx_hash.hex()}")
# Wait for confirmation and return receipt
receipt = self.web3.eth.wait_for_transaction_receipt(tx_hash)
return receipt
def borrow_asset(self, token_symbol, amount):
"""Borrow assets from Compound"""
ctoken_symbol = f'c{token_symbol.lower()}'
if ctoken_symbol not in self.ctoken_contracts:
raise ValueError(f"Unsupported token: {token_symbol}")
ctoken = self.ctoken_contracts[ctoken_symbol]
# Check borrowing capacity
account_liquidity = self.get_account_liquidity()
if account_liquidity['shortfall'] > 0:
raise ValueError("Account has shortfall, cannot borrow")
borrow_amount = int(amount * 10**18) # Assume 18 decimals
# Check if amount is within borrowing capacity
token_price = self.get_token_price(token_symbol)
borrow_value_usd = amount * token_price
if borrow_value_usd > account_liquidity['liquidity']:
raise ValueError(f"Borrow amount exceeds liquidity: {borrow_value_usd} > {account_liquidity['liquidity']}")
# Execute borrow
transaction = ctoken.functions.borrow(borrow_amount).build_transaction({
'from': self.wallet_address,
'gas': 200000,
'gasPrice': self.web3.to_wei('20', 'gwei'),
'nonce': self.web3.eth.get_transaction_count(self.wallet_address)
})
signed_tx = self.web3.eth.account.sign_transaction(transaction, self.private_key)
tx_hash = self.web3.eth.send_raw_transaction(signed_tx.rawTransaction)
print(f"Borrow transaction: {tx_hash.hex()}")
receipt = self.web3.eth.wait_for_transaction_receipt(tx_hash)
return receipt
def get_account_liquidity(self):
"""Get account liquidity and borrowing capacity"""
error, liquidity, shortfall = self.comptroller.functions.getAccountLiquidity(
self.wallet_address
).call()
if error != 0:
raise ValueError(f"Error getting account liquidity: {error}")
return {
'liquidity': liquidity / 1e18, # USD value of borrowing capacity
'shortfall': shortfall / 1e18, # USD value of shortfall
'health_factor': float('inf') if shortfall == 0 else liquidity / shortfall if shortfall > 0 else float('inf')
}
def enable_collateral(self, ctoken_symbol):
"""Enable a cToken as collateral"""
ctoken_address = COMPOUND_CONFIG[ctoken_symbol]
# Check if already enabled
assets_in = self.comptroller.functions.getAssetsIn(self.wallet_address).call()
if ctoken_address not in assets_in:
# Enable as collateral
transaction = self.comptroller.functions.enterMarkets([ctoken_address]).build_transaction({
'from': self.wallet_address,
'gas': 150000,
'gasPrice': self.web3.to_wei('20', 'gwei'),
'nonce': self.web3.eth.get_transaction_count(self.wallet_address)
})
signed_tx = self.web3.eth.account.sign_transaction(transaction, self.private_key)
tx_hash = self.web3.eth.send_raw_transaction(signed_tx.rawTransaction)
print(f"Collateral enabled: {tx_hash.hex()}")
receipt = self.web3.eth.wait_for_transaction_receipt(tx_hash)
return receipt
print(f"{ctoken_symbol} already enabled as collateral")
return None
# Initialize Compound
compound = CompoundExchange({
'rpc_url': 'https://mainnet.infura.io/v3/YOUR_INFURA_KEY',
'wallet_address': 'your_wallet_address',
'private_key': 'your_private_key'
})
# MakerDAO Configuration
MAKER_CONFIG = {
'mcd_cat': '0xa5679C04fc3d9d8b0AaB1F0ab83555b301cA70Ea', # Liquidation
'mcd_vat': '0x35D1b3F3D7966A1DFe207aa4514C12a259A0492B', # Core CDP engine
'mcd_dai': '0x6B175474E89094C44Da98b954EedeAC495271d0F', # DAI token
'mcd_pot': '0x197E90f9FAD81970bA7976f33CbD77088E5D7cf7', # DAI savings rate
'mcd_join_dai': '0x9759A6Ac90977b93B58547b4A71c78317f391A28', # DAI join
'mcd_jug': '0x19c0976f590D67707E62397C87829d896Dc0f1F1', # Stability fees
# Collateral joins
'mcd_join_eth_a': '0x2F0b23f53734252Bda2277357e97e1517d6B042A',
'mcd_join_wbtc_a': '0xBF72Da2Bd84c5170618Fbe5914B0ECA9638d5eb5',
'mcd_join_usdc_a': '0xA191e578a6736167326d05c119CE0c90849E84B7',
# Proxy actions
'proxy_actions': '0x82ecD135Dce65Fbc6DbdD0e4237E0AF93FFD5038',
'proxy_registry': '0x4678f0a6958e4D2Bc4F1BAF7Bc52E8F3564f3fE4'
}
class MakerDAOExchange:
def __init__(self, config):
self.web3 = Web3(Web3.HTTPProvider(config['rpc_url']))
self.wallet_address = config['wallet_address']
self.private_key = config['private_key']
# Load ABIs
self.vat_abi = self.load_abi('vat')
self.dai_abi = self.load_abi('dai')
self.pot_abi = self.load_abi('pot')
self.proxy_actions_abi = self.load_abi('proxy_actions')
# Initialize core contracts
self.vat = self.web3.eth.contract(
address=MAKER_CONFIG['mcd_vat'],
abi=self.vat_abi
)
self.dai = self.web3.eth.contract(
address=MAKER_CONFIG['mcd_dai'],
abi=self.dai_abi
)
self.pot = self.web3.eth.contract(
address=MAKER_CONFIG['mcd_pot'],
abi=self.pot_abi
)
# Get or create DS-Proxy
self.proxy_address = self.get_or_create_proxy()
def get_vault_info(self, vault_id):
"""Get detailed information about a specific vault"""
vault_data = self.vat.functions.urns(
b'ETH-A', # ilk (collateral type)
self.proxy_address
).call()
ink = vault_data[0] / 1e18 # Collateral amount
art = vault_data[1] / 1e18 # Debt amount
# Get collateralization ratio
eth_price = self.get_eth_price()
collateral_value = ink * eth_price
collateralization_ratio = (collateral_value / art) if art > 0 else float('inf')
# Get liquidation price
liquidation_ratio = self.get_liquidation_ratio('ETH-A')
liquidation_price = (art * liquidation_ratio) / ink if ink > 0 else 0
return {
'vault_id': vault_id,
'collateral_eth': ink,
'debt_dai': art,
'collateral_value_usd': collateral_value,
'collateralization_ratio': collateralization_ratio,
'liquidation_price': liquidation_price,
'liquidation_ratio': liquidation_ratio,
'is_safe': collateralization_ratio > liquidation_ratio if art > 0 else True
}
def open_vault_and_draw_dai(self, eth_amount, dai_amount):
"""Open a new vault and draw DAI"""
# Use DS-Proxy for complex transaction
proxy_actions = self.web3.eth.contract(
address=MAKER_CONFIG['proxy_actions'],
abi=self.proxy_actions_abi
)
# Encode the openLockETHAndDraw call
call_data = proxy_actions.encodeABI(
fn_name='openLockETHAndDraw',
args=[
MAKER_CONFIG['mcd_join_eth_a'], # ETH join adapter
MAKER_CONFIG['mcd_join_dai'], # DAI join adapter
b'ETH-A', # Collateral type
int(dai_amount * 1e18) # DAI to draw (in wei)
]
)
# Execute through DS-Proxy
transaction = {
'from': self.wallet_address,
'to': self.proxy_address,
'value': self.web3.to_wei(eth_amount, 'ether'),
'data': call_data,
'gas': 500000,
'gasPrice': self.web3.to_wei('30', 'gwei'),
'nonce': self.web3.eth.get_transaction_count(self.wallet_address)
}
signed_tx = self.web3.eth.account.sign_transaction(transaction, self.private_key)
tx_hash = self.web3.eth.send_raw_transaction(signed_tx.rawTransaction)
print(f"Vault creation transaction: {tx_hash.hex()}")
receipt = self.web3.eth.wait_for_transaction_receipt(tx_hash)
# Parse events to get vault ID
vault_id = self.parse_vault_id_from_receipt(receipt)
return {
'vault_id': vault_id,
'transaction_hash': tx_hash.hex(),
'collateral_deposited': eth_amount,
'dai_drawn': dai_amount
}
def manage_vault_safety(self, vault_id, target_ratio=2.5):
"""Automatically manage vault safety by maintaining target collateralization ratio"""
vault_info = self.get_vault_info(vault_id)
current_ratio = vault_info['collateralization_ratio']
liquidation_ratio = vault_info['liquidation_ratio']
print(f"Current ratio: {current_ratio:.2f}")
print(f"Target ratio: {target_ratio}")
print(f"Liquidation ratio: {liquidation_ratio:.2f}")
if current_ratio < target_ratio * 1.1: # 10% buffer above target
# Need to improve ratio
if current_ratio < liquidation_ratio * 1.2: # Danger zone
print("🚨 URGENT: Vault near liquidation!")
self.emergency_vault_protection(vault_id, vault_info)
else:
print("⚠️ Vault ratio below target, rebalancing...")
self.rebalance_vault(vault_id, vault_info, target_ratio)
elif current_ratio > target_ratio * 1.5: # Much higher than target
print("💰 Vault over-collateralized, optimizing...")
self.optimize_vault_efficiency(vault_id, vault_info, target_ratio)
def emergency_vault_protection(self, vault_id, vault_info):
"""Emergency protection for vaults near liquidation"""
# Option 1: Add more ETH collateral
additional_eth_needed = self.calculate_additional_collateral_needed(
vault_info, target_ratio=2.0 # Safety target
)
eth_balance = self.web3.eth.get_balance(self.wallet_address) / 1e18
if eth_balance >= additional_eth_needed:
print(f"Adding {additional_eth_needed:.4f} ETH collateral")
self.add_collateral(vault_id, additional_eth_needed)
else:
# Option 2: Repay some DAI debt
dai_balance = self.dai.functions.balanceOf(self.wallet_address).call() / 1e18
if dai_balance > 0:
repay_amount = min(dai_balance, vault_info['debt_dai'] * 0.2) # Repay up to 20%
print(f"Repaying {repay_amount:.2f} DAI debt")
self.repay_dai(vault_id, repay_amount)
else:
print("🚨 No ETH or DAI available for emergency protection!")
# Consider liquidating other positions or external funding
def stake_dai_in_dsr(self, dai_amount):
"""Stake DAI in the DAI Savings Rate (DSR)"""
current_dsr = self.pot.functions.dsr().call()
dsr_apy = ((current_dsr / 1e27) - 1) * (365 * 24 * 3600) / (365 * 24 * 3600) * 100
print(f"Current DSR: {dsr_apy:.2f}% APY")
if dsr_apy > 0.5: # Only stake if DSR > 0.5%
# Approve DAI spending
approve_tx = self.dai.functions.approve(
MAKER_CONFIG['mcd_pot'],
int(dai_amount * 1e18)
).build_transaction({
'from': self.wallet_address,
'gas': 100000,
'gasPrice': self.web3.to_wei('20', 'gwei'),
'nonce': self.web3.eth.get_transaction_count(self.wallet_address)
})
signed_approve = self.web3.eth.account.sign_transaction(approve_tx, self.private_key)
approve_hash = self.web3.eth.send_raw_transaction(signed_approve.rawTransaction)
self.web3.eth.wait_for_transaction_receipt(approve_hash)
# Join DSR
join_tx = self.pot.functions.join(int(dai_amount * 1e18)).build_transaction({
'from': self.wallet_address,
'gas': 200000,
'gasPrice': self.web3.to_wei('20', 'gwei'),
'nonce': self.web3.eth.get_transaction_count(self.wallet_address)
})
signed_join = self.web3.eth.account.sign_transaction(join_tx, self.private_key)
join_hash = self.web3.eth.send_raw_transaction(signed_join.rawTransaction)
print(f"DAI staked in DSR: {join_hash.hex()}")
receipt = self.web3.eth.wait_for_transaction_receipt(join_hash)
return receipt
print("DSR rate too low, not staking")
return None
# Initialize MakerDAO
maker = MakerDAOExchange({
'rpc_url': 'https://mainnet.infura.io/v3/YOUR_INFURA_KEY',
'wallet_address': 'your_wallet_address',
'private_key': 'your_private_key'
})
def defi_yield_optimization_strategy():
"""
Automatically optimize yield across multiple DeFi lending platforms
"""
print("📈 DeFi Yield Optimization Strategy")
print("=" * 40)
# Get current rates across platforms
platforms = {
'compound_usdc': compound.get_market_info('cusdc')['supply_apy'],
'aave_usdc': aave.get_reserve_data('USDC')['supply_apy'], # From previous Aave integration
'maker_dsr': maker.get_current_dsr_rate(),
'euler_usdc': euler.get_market_info('USDC')['supply_apy']
}
print("Current Yield Rates:")
for platform, apy in platforms.items():
print(f" {platform}: {apy:.2f}% APY")
# Find best yield opportunity
best_platform = max(platforms, key=platforms.get)
best_rate = platforms[best_platform]
print(f"\n🏆 Best rate: {best_platform} at {best_rate:.2f}% APY")
# Get current allocations
current_allocations = get_current_defi_allocations()
total_capital = sum(current_allocations.values())
if total_capital > 1000: # Minimum $1000 for optimization
# Calculate optimal allocation
optimal_allocation = calculate_optimal_yield_allocation(platforms, total_capital)
# Execute rebalancing
execute_yield_rebalancing(current_allocations, optimal_allocation)
def calculate_optimal_yield_allocation(rates, total_capital):
"""
Calculate optimal capital allocation across lending platforms
"""
# Simple allocation: 70% to best rate, 30% to second best (diversification)
sorted_platforms = sorted(rates.items(), key=lambda x: x[1], reverse=True)
allocation = {}
allocation[sorted_platforms[0][0]] = total_capital * 0.7 # 70% to best
allocation[sorted_platforms[1][0]] = total_capital * 0.3 # 30% to second best
print(f"\nOptimal Allocation:")
for platform, amount in allocation.items():
percentage = (amount / total_capital) * 100
print(f" {platform}: ${amount:,.2f} ({percentage:.0f}%)")
return allocation
def execute_yield_rebalancing(current, optimal):
"""
Execute rebalancing between lending platforms
"""
print("\nREBALANCING: Executing Yield Rebalancing:")
for platform, target_amount in optimal.items():
current_amount = current.get(platform, 0)
difference = target_amount - current_amount
if abs(difference) > 100: # Only rebalance if difference > $100
if difference > 0:
# Need to add capital to this platform
print(f" Adding ${difference:,.2f} to {platform}")
add_capital_to_platform(platform, difference)
else:
# Need to remove capital from this platform
print(f" Removing ${abs(difference):,.2f} from {platform}")
remove_capital_from_platform(platform, abs(difference))
def add_capital_to_platform(platform, amount):
"""Add capital to specific lending platform"""
if platform.startswith('compound'):
token = platform.split('_')[1]
compound.supply_asset(token, amount)
elif platform.startswith('maker'):
maker.stake_dai_in_dsr(amount)
elif platform.startswith('aave'):
token = platform.split('_')[1]
aave.supply(token, amount)
elif platform.startswith('euler'):
token = platform.split('_')[1]
euler.supply(token, amount)
def leveraged_yield_farming_strategy():
"""
Advanced leveraged yield farming across multiple protocols
"""
print("⚡ Leveraged Yield Farming Strategy")
print("=" * 35)
# Step 1: Supply ETH as collateral on Compound
eth_amount = 2.0 # 2 ETH
compound.supply_asset('ETH', eth_amount)
compound.enable_collateral('ceth')
print(f"✅ Supplied {eth_amount} ETH as collateral")
# Step 2: Borrow stablecoins against ETH
account_liquidity = compound.get_account_liquidity()
max_borrow_usd = account_liquidity['liquidity'] * 0.8 # 80% of max for safety
# Borrow USDC
usdc_borrow_amount = max_borrow_usd
compound.borrow_asset('USDC', usdc_borrow_amount)
print(f"✅ Borrowed {usdc_borrow_amount:,.2f} USDC")
# Step 3: Deploy borrowed USDC for higher yield
deployment_strategies = [
{
'platform': 'curve_3pool',
'allocation': 0.5,
'expected_apy': 8.5,
'strategy': 'Curve 3Pool LP + Convex rewards'
},
{
'platform': 'yearn_usdc_vault',
'allocation': 0.3,
'expected_apy': 7.2,
'strategy': 'Yearn USDC Vault auto-compounding'
},
{
'platform': 'aave_usdc',
'allocation': 0.2,
'expected_apy': 5.8,
'strategy': 'Aave USDC lending for safety'
}
]
total_deployed = 0
for strategy in deployment_strategies:
deploy_amount = usdc_borrow_amount * strategy['allocation']
print(f"📊 Deploying ${deploy_amount:,.2f} to {strategy['platform']}")
print(f" Expected APY: {strategy['expected_apy']:.1f}%")
# Deploy capital based on strategy
if strategy['platform'] == 'curve_3pool':
deploy_to_curve_3pool(deploy_amount)
elif strategy['platform'] == 'yearn_usdc_vault':
deploy_to_yearn_vault(deploy_amount, 'USDC')
elif strategy['platform'] == 'aave_usdc':
aave.supply('USDC', deploy_amount)
total_deployed += deploy_amount
# Calculate net APY
borrow_cost = compound.get_market_info('cusdc')['borrow_apy']
weighted_yield = sum(s['allocation'] * s['expected_apy'] for s in deployment_strategies)
net_apy = weighted_yield - borrow_cost
print(f"\n📈 Strategy Summary:")
print(f" Total Deployed: ${total_deployed:,.2f}")
print(f" Borrow Cost: {borrow_cost:.2f}% APY")
print(f" Weighted Yield: {weighted_yield:.2f}% APY")
print(f" Net APY: {net_apy:.2f}% APY")
if net_apy > 3: # Profitable if net APY > 3%
print("✅ Strategy is profitable!")
monitor_leveraged_position()
else:
print("⚠️ Strategy may not be profitable")
def monitor_leveraged_position():
"""
Continuously monitor leveraged position for safety
"""
print("🔍 Monitoring Leveraged Position")
while True:
# Check health factor
account_liquidity = compound.get_account_liquidity()
health_factor = account_liquidity['health_factor']
print(f"Health Factor: {health_factor:.2f}")
if health_factor < 1.3: # Danger zone
print("🚨 Low health factor! Taking protective action...")
emergency_deleverage()
break
elif health_factor < 1.5: # Warning zone
print("⚠️ Health factor declining, reducing leverage...")
partial_deleverage(0.3) # Reduce leverage by 30%
# Check if yield strategies are still profitable
current_yields = get_current_strategy_yields()
borrow_cost = compound.get_market_info('cusdc')['borrow_apy']
weighted_current_yield = calculate_weighted_yield(current_yields)
if weighted_current_yield - borrow_cost < 1: # Less than 1% net APY
print("📉 Yields declined, considering position closure...")
close_leveraged_position()
break
time.sleep(300) # Check every 5 minutes
def emergency_deleverage():
"""Emergency deleveraging when health factor is critical"""
print("🚨 EMERGENCY DELEVERAGING")
# Quickly withdraw from highest liquidity strategy first
strategy_liquidities = {
'aave_usdc': 0.9, # Highest liquidity
'yearn_usdc_vault': 0.7, # Medium liquidity
'curve_3pool': 0.5 # Lower liquidity (due to IL risk)
}
for strategy, liquidity_score in sorted(strategy_liquidities.items(), key=lambda x: x[1], reverse=True):
try:
withdraw_amount = get_strategy_balance(strategy)
withdraw_from_strategy(strategy, withdraw_amount)
# Repay debt immediately
compound.repay_asset('USDC', withdraw_amount)
# Check if health factor is now safe
if compound.get_account_liquidity()['health_factor'] > 1.5:
break
except Exception as e:
print(f"Error withdrawing from {strategy}: {e}")
continue
def cross_protocol_arbitrage():
"""
Arbitrage lending rates across different DeFi protocols
"""
print("ARBITRAGE: Cross-Protocol Arbitrage Strategy")
print("=" * 35)
# Get borrowing and lending rates across protocols
protocols = {
'compound': {
'supply_apy': compound.get_market_info('cusdc')['supply_apy'],
'borrow_apy': compound.get_market_info('cusdc')['borrow_apy']
},
'aave': {
'supply_apy': aave.get_reserve_data('USDC')['supply_apy'],
'borrow_apy': aave.get_reserve_data('USDC')['borrow_apy']
},
'euler': {
'supply_apy': euler.get_market_info('USDC')['supply_apy'],
'borrow_apy': euler.get_market_info('USDC')['borrow_apy']
}
}
# Find arbitrage opportunities
arbitrage_opportunities = []
for borrow_protocol, borrow_data in protocols.items():
for supply_protocol, supply_data in protocols.items():
if borrow_protocol != supply_protocol:
spread = supply_data['supply_apy'] - borrow_data['borrow_apy']
if spread > 0.5: # Minimum 0.5% spread for profitability
arbitrage_opportunities.append({
'borrow_from': borrow_protocol,
'supply_to': supply_protocol,
'spread': spread,
'borrow_rate': borrow_data['borrow_apy'],
'supply_rate': supply_data['supply_apy']
})
# Execute most profitable arbitrage
if arbitrage_opportunities:
best_arbitrage = max(arbitrage_opportunities, key=lambda x: x['spread'])
print(f"🎯 Best Arbitrage Opportunity:")
print(f" Borrow from: {best_arbitrage['borrow_from']} at {best_arbitrage['borrow_rate']:.2f}%")
print(f" Supply to: {best_arbitrage['supply_to']} at {best_arbitrage['supply_rate']:.2f}%")
print(f" Spread: {best_arbitrage['spread']:.2f}%")
# Execute arbitrage
arbitrage_amount = 10000 # $10,000 USDC
execute_cross_protocol_arbitrage(
best_arbitrage['borrow_from'],
best_arbitrage['supply_to'],
arbitrage_amount
)
else:
print("No profitable arbitrage opportunities found")
def execute_cross_protocol_arbitrage(borrow_protocol, supply_protocol, amount):
"""Execute cross-protocol arbitrage"""
print(f"⚡ Executing arbitrage: {amount:,.0f} USDC")
# Step 1: Borrow from cheaper protocol
if borrow_protocol == 'compound':
compound.borrow_asset('USDC', amount)
elif borrow_protocol == 'aave':
aave.borrow('USDC', amount)
elif borrow_protocol == 'euler':
euler.borrow('USDC', amount)
print(f"✅ Borrowed ${amount:,.0f} from {borrow_protocol}")
# Step 2: Supply to higher-yield protocol
if supply_protocol == 'compound':
compound.supply_asset('USDC', amount)
elif supply_protocol == 'aave':
aave.supply('USDC', amount)
elif supply_protocol == 'euler':
euler.supply('USDC', amount)
print(f"✅ Supplied ${amount:,.0f} to {supply_protocol}")
# Step 3: Monitor position and close when spread narrows
monitor_arbitrage_position(borrow_protocol, supply_protocol, amount)
Add to your .env file:
# DeFi Lending Configuration
COMPOUND_RPC_URL=https://mainnet.infura.io/v3/YOUR_INFURA_KEY
COMPOUND_WALLET_ADDRESS=your_wallet_address
COMPOUND_PRIVATE_KEY=your_private_key
# MakerDAO Configuration
MAKER_RPC_URL=https://mainnet.infura.io/v3/YOUR_INFURA_KEY
MAKER_WALLET_ADDRESS=your_wallet_address
MAKER_PRIVATE_KEY=your_private_key
MAKER_PROXY_ADDRESS=your_ds_proxy_address
# Risk Management
DEFI_MAX_LEVERAGE=3.0
DEFI_MIN_HEALTH_FACTOR=1.5
DEFI_AUTO_REBALANCE=true
DEFI_YIELD_OPTIMIZATION_INTERVAL=3600
# Strategy Parameters
DEFI_MIN_APY_SPREAD=0.5
DEFI_MIN_ARBITRAGE_AMOUNT=1000
DEFI_EMERGENCY_DELEVERAGE_THRESHOLD=1.2
This comprehensive DeFi lending documentation provides full integration capabilities for major lending protocols with advanced strategies including yield optimization, leveraged farming, and cross-protocol arbitrage within PowerTraderAI+.