This Week in Uniswap v3–10/12/2023

Hey DeFi enthusiasts, welcome back to our weekly deep dive where we showcase three high-performing Uniswap v3 Concentrated Liquidity Pools. As always, we’re here to bring you the latest insights straight from the heart of DeFi.

The data in this blog series is for educational use only. Investing in liquidity pools comes with a risk of loss and the returns mentioned are not guaranteed. We assume no liability for any losses incurred. Always conduct your own research and consult with a financial advisor before making investment decisions. Invest wisely!

We found all of the following Uniswap v3 Liquidity pools using our tool, BuildrMetrics. BuildrMetrics is an all-in-one Uniswap v3 Liquidity Provider solution. It allows you to find, estimate, and track top Uniswap v3 Concentrated Liquidity Pools.

Weekly Developments

Over the last week, BTC has taken a 2.6% hit while ETH has taken a 4.8% hit! With that being said, altcoins are down even more. MATIC, AVAX, LINK, and SOL are down 7.4%, 10%, 3.6%, and 7.1% respectively.

While this volume is good for those who are yield farming, your principal assets might have seen a decline!

ETH/USDC — LOW RISK

• ETH & USDC
• Ethereum Mainnet
• 0.05% Fee Tier

In the last three months, the ETH/USDC pool on the Ethereum mainnet has been doing exceptionally well. Investors have had the opportunity to earn an impressive 30–40% annual return when using broad ranges, and even up to 80–100% when setting tight ranges.

However, one thing to note is ETH is down 4.8% in the past week. With negative returns like this, it’s important to consider hedging your Uniswap v3 pool or running your LP with broader ranges (to allow for downside exposure).

As mentioned earlier, this sell pressure is really good for ETH yield farmers who are looking to increase their exposure to ETH. With a range of 1,480–1,635 USDC per ETH, you’re expected to obtain a 59.07% APR, which is very nice for a blue-chip ETH/USDC pool.

With that being said, it’s important to adapt your Uniswap v3 Liquidity Pool range to your market stance, if you’re bullish on the crypto market, allow for more upside exposure. If you’re bearish on the crypto market, allow for more downside exposure.

WBTC/USDC — LOW RISK

• WBTC & USDC
• Ethereum Mainnet
• 0.3% Fee Tier

I’ve invested $20,000 in a WBTC/USDC liquidity pool on the Ethereum network. Right now, it’s generating about a 35% annual return, which I find incredible, especially since I’m only exposed to blue-chip assets and the risk is minimal.

Similar to Ethereum, Bitcoin is down in the previous week, however, it’s only down 2.6% compared to the 4.8% ETH is down. If you’re looking to increase your exposure to BTC, a DCA liquidity pool strategy might be a good option to look into.

I personally have a range of 25,500–29,000 USDC per WBTC and it’s returning right on target at 36.79% APR. Do consider adding a hedge to your position or allowing for more downside exposure in the case that the market flips to be more bearish.

ETH/GALA — HIGH RISK

• ETH & GALA
• Ethereum Mainnet
• 0.3% Fee Tier

GALA is the native token of Gala Games, a Web3 Gaming company that is governed by the players of the game. Gala Games has many games you can choose from and earns revenue through in-game purchases. GALA token is used to host GALA nodes to support the ecosystem.

While GALA is an interesting token with a use case, it’s also a volatile altcoin. In the past week, GALA has suffered a 6.9% decline, but in the past 24 hours has seen a 2.2% incline. This could hint that GALA’s popularity is heating up. Remember, before investing in a liquidity pool, make sure you don’t mind holding the underlying assets.

A tight range of 108,000–122,000 is expected to return 213.89% APR, but do keep in mind that you could realize a large amount of impermanent loss if the price of GALA moves significantly and you have to rebalance.

If you’re focused solely on yield farming, you might find the staggering 213.89% annual return quite enticing. Do remember, that in this liquidity pool, you have exposure to two volatile assets as opposed to one volatile asset paired with one stablecoin.

That Wraps It Up!

We hope you enjoyed this week’s Uniswap v3 Liquidity Pool list! If you wish to dive further and find some pools that weren’t mentioned on this list, head over to the BuildrMetrics Pool Explorer! Furthermore, after you find a pool, you can calculate your returns directly through our site!

If you’re interested in the BuildrWealth team implementing our 5-Step Copy & Paste process into your DeFi portfolio, schedule a free strategy session with one of BuildrWealth’s team members!

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