This Week’s Uniswap v3 Goldmines: How to Earn 50% on ETH and 92% on LINK

Join us in 'This Week in Uniswap v3' for the latest on top concentrated liquidity pools. Stay ahead with expert insights on high-performing Uniswap pools.

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

The cryptocurrency market has soared the past 7 days, with BTC being up 15% and ETH being up 11% in the past 7 days. Altcoins like SOL, LINK, and AVAX are up 19.5%, 44.1%, and 16.9% respectively. This week’s pump showcases to the entire industry that a Cryptocurrency Bull Run is in sight!

Uniswap Labs implemented a 0.15% fee on there frontend, allowing for longer runway of the Uniswap platform. As a trader you can avoid this fee by using an aggregator like KyberSwap or ParaSwap. Learn more about this new fee and how it affects you here.

Uniswap v3 Volume & Fees from Green represents volume, Purple represents fees.
Uniswap v3 Volume & Fees from Green represents volume, Purple represents fees.

Analyzing the Trading Volume & Fees Collected on Uniswap v3 through TokenTerminal allows us to see that we have see more than a 100% incline in trading volume on the same day that the crypto market started to pump.

October 23rd and October 24th are Uniswap’s 2nd and 3rd highest volume days in the past 90 days. However, we can see a slight retracement in volume starting the 25th and continuing out on the 26th. This is due to a set-back in the market and creates a great buying opportunity for certain cryptocurrencies.

Let’s take a look at 3 different Uniswap v3 Liquidity Pools that you could be earning a high return on.

ETH/USDbC — Low Risk

  • ETH & USDbC
  • Base Network
  • 0.05% Fee Tier

As we spoke about earlier, Ethereum has seen some nice price action over the previous 7 days. This is allowing for high-fees across pretty much every network on ETH/USDC liquidity pools. However, we chose the Base network in particular because not only does it have the highest APR, but it has low gas fees, high liquidity, and consistent volume.

ETH/USD performance over the past 7 days, derived from CoinGecko.
ETH/USD performance over the past 7 days, derived from CoinGecko.

By using methods & concepts from our new Uniswap v3 Mini-Course, we’ll select a range of 1,600 to 2,000 USDbC per ETH. This range encapsulates the previous 7 days of price action, but allows for ETH to continue to rise in price. Assuming ETH rises to ~1,900 USDbC per ETH, we would want to rebalance our pool to allow for more upside exposure.

ETH/USDbC Uniswap v3 Liquidity Pool simulated on BuildrMetrics.

The best part about the Base network is you do not need to worry about high gas costs, they are pennies! Usually, most pools perform best on Ethereum Mainnet, restricting those that have lower capital, however, this one on the Base network is perfect for anyone with lower capital.

A range of 1,600 to 2,000 USDbC per ETH is estimate to return a 50% APR. Quick note, this APR is expected to be high as recently we have seen a surge in volume. Currently I have an ETH/USDC position on Ethereum Mainnet that is returning ~65% APR, yet it’s showing 40% APR on the calculator. Time for me to switch to Base!

WBTC/ETH — Low Risk

  • WBTC & ETH
  • Ethereum Network
  • 0.05% Fee Tier

Recently BTC has been outperforming ETH due to speculation around a Bitcoin Spot ETF being approved. A quick recap, in the past 7 days, BTC is up 15% and ETH is up 11%. While BTC is outperforming ETH, both of these assets are still closely correlated. Which means, pairing them in a liquidity pool will allow for good returns without a lot of impermanent loss risk.

WBTCWETH Chart on TradingView.
WBTCWETH Chart on TradingView.

By analyzing the TradingView chart we can see that the pool price has seen an increase over the previous 30 days. This increase symbols that BTC has been outperforming ETH over the past 30 days, because it’s taking more ETH to equal one BTC. In our range, we’ll allow for BTC to continue to outperform ETH because a Bitcoin Spot ETF approval could allow for BTC to have a substancial amount of upside. However, we’ll also include some downside exposure in case ETH starts to lead the market.

WBTC/ETH Uniswap v3 Liquidity Pool simulated on BuildrMetrics.
WBTC/ETH Uniswap v3 Liquidity Pool simulated on BuildrMetrics.

A range of 17.5 to 21 ETH per WBTC is estimated to return a 28% APR, again, this APR will most likely be higher due to increased volume over the previous 7 days. This allows for WBTC to continue to outperform ETH, but at the same time allowing you to put up roughly 50/50 of each asset.

LINK/USDC — Medium Risk

  • Ethereum Network
  • 0.3% Fee Tier

If you’ve been in crypto or DeFi for a while, you’ve probably heard of Chainlink, better known as LINK. LINK essentially powers different decentralized applications through Oracles. It’s the leading solution in DeFi and crypto as it brings off-chain data directly on-chain, into smart contracts. Top dApps including Aave use Chainlink for their oracles.

LINK/USD performance over the past 7 days, derived from CoinGecko.
LINK/USD performance over the past 7 days, derived from CoinGecko.

LINK has actually been performing well the past 45 days and started to see bullish price action way before Bitcoin. This is simply due to new concepts and ideas that have been announced by Chainlink, including powering the Real World Asset sector of DeFi, and helping tokenize illiquid assets.

LINK/USDC Uniswap v3 Liquidity Pool simulated on BuildrMetrics.

The range we chose of 9 to 13 USDC per LINK has plenty of upside exposure for the next week or so, with room for LINK to retrace a little bit. It is recommended to carefully monitor this position to make sure you can rebalance your pool before it goes out of range. Consider setting price notifications using the CoinGecko app.

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!

We just released a Uniswap v3 Mini-Course where you’ll learn the 4 pillars of Uniswap v3 Concentrated Liquidity. If you’re interested in becoming an expert, check it out.

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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