Alpaca Finance is the largest lending protocol that offers users leveraged yield farming on the BNB Chain and Fantom network.

Risk Rating
Protocol Code Quality
Protocol Maturity
Protocol Design
What we like
Alpaca offers users the ability yield farm with leverage to multiply their returns. Farmers also can customize their exposure and risk, or use automated vaults to easily access market-neutral strategies without the need to constantly rebalance and monitor positions.
What we like less
Alpaca's lending platform provides leveraged yield farmers with undercollateralized loans that can only be used within the platform, but increases the risk that its AlpacaUSD (AUSD) stablecoin depegs.
What it means for you
Alpaca unlocks higher capital efficiency and provides you attractive yields that are umatched by under-leveraged competitors.
  • Website
  • Token: ALPACA
  • Tags: Yield
Key Metrics
  • TVL: $115M (Rank #46)
  • TVL Ranking by Yield: #0
  • Blockchain: Binance, Fantom
  • Chain TVL
    • Binance: $114.12M
    • Fantom: $929.07K
Risk Assessment
Protocol Code Quality
  • Code reviewed by several experienced auditors including CertiK and PeckShield
  • Public team promotes accountability
  • No documented protocol hacks since launch
  • Robust controls to mitigate oracle price manipulation
Protocol Maturity
  • Core protocol launched in 2021; maturity over 1 year reduces technical risk as smart contracts are moderately battle-tested
  • Top 5% by total value locked reduces risk
  • Decentralized governance increases transparency
  • Low voting power concentration reduces risk
Protocol Design
  • No concerns identified
  • Alpaca is the largest leveraged yield farming protocol on BNB Chain and has since expanded to Fantom to become a multichain platform
Things to know about Alpaca

How Alpaca works

Alpaca is a lending protocol that allows for leveraged yield farming by assuming additional risk within the platform. At its core, Alpaca is a two-sided money market platform with lenders and borrowers. Lenders earn interest by depositing assets into specific vaults. These assets are then offered to leveraged yield farmers as undercollateralized loans that can only be used within the Alpaca platform. Lenders receive a proportional balance of pool-specific interest-bearing tokens (ibTokens) to track their deposited funds and accrued interest. These ibTokens can further be used by lenders to generate additional yield by minting AUSD, which is forked from MakerDAO. Yield farmers use the undercollateralized loans provided by Alpaca to multiply their returns.

How Alpaca makes money

Alpaca generates protocol revenue from a variety of sources including yield farming performance fees, liquidation fees, lending interest, non-fungible token (NFT) royalties, AUSD stability fees, and vault management and withdrawal fees. In most cases, Alpaca has elected to use the protocol revenue to buyback and burn the native ALPACA token to enhance its value.

How you make money on Alpaca

You can earn yield by depositing assets to earn borrowing interest, maximize your LP positions through leverage, and earn passive income with AUSD from inflationary protocol emissions. ALPACA holders can also stake in the governance vault in exchange for xALPACA to receive platform revenue sharing. The deflationary nature of ALPACA also means the token price should increase over time simply from holding as more ALPACA is burnt from the market.