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Sections used: Margin · Farm  ·  Delta exposure: None (XLM-neutral)  ·  Risk level: Medium–High  ·  Complexity: High
Deposit USDC as Margin collateral and borrow XLM. Rather than deploying all borrowed XLM to a single venue, split it between two parallel positions: Blend’s XLM single-asset pool and Aquarius’s XLM/USDC LP pool. Both deployment legs are denominated in XLM, so the borrow and the combined farm exposure cancel out on price. The strategy earns two independent yield spreads - Blend supply yield and Aquarius LP fees - from the same capital base and the same single borrow position.

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Why this is delta-neutral

Blend leg: XLM borrowed and XLM deposited to Blend cancel exactly on price. Any XLM price movement affects both sides by the same amount. Aquarius leg: XLM allocated to the Aquarius XLM/USDC pool is also denominated partially in XLM. Combined with the Blend XLM allocation, the total XLM farm exposure still matches the total XLM borrow, so net price exposure remains near zero. USDC collateral: Stable. The collateral value is unaffected by XLM price movements. The only source of profit or loss on each leg is the yield differential between what each venue pays and what Vanna charges on the XLM borrow.

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How to execute

1

Open a Margin Account and deposit USDC

Go to Margin → Open Account if you don’t have one. Then go to Deposit & Borrow → deposit USDC as collateral. This single collateral position backs the entire XLM borrow.
2

Borrow XLM

In the borrow panel, select XLM and borrow against your USDC collateral. Keep Health Factor at 1.5× or above after borrowing. You will split this XLM across two venues in the next steps.
3

Deploy first half of XLM to the Blend XLM pool

Go to Farm → Single-Asset Pools → select the Blend XLM pool → enter roughly half your borrowed XLM → Add Liquidity. The first carry leg is now live.
4

Deploy second half of XLM to the Aquarius XLM/USDC pool

Go to Farm → Aquarius Pools → select the XLM/USDC pool → enter the remaining XLM → Add Liquidity. Both carry legs are now running in parallel from the same borrow position.

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Example

USDC collateral deposited$1,000 USDC
XLM borrowed (total)$400 worth of XLM
XLM deployed to Blend XLM pool (half)$200 worth of XLM
Blend XLM Supply APY12% → earns $24/year
XLM deployed to Aquarius XLM/USDC pool (half)$200 worth of XLM
Aquarius XLM/USDC LP APY10% → earns $20/year
Vanna XLM Borrow APR (on full $400)8% → costs $32/year
Combined annual yield24+24 + 20 − 32=32 = 12
Total capital deployed$1,000 USDC
Net XLM price exposureNear zero
Both deployment legs must independently justify their share of the borrow cost. If one venue’s yield drops, that leg may no longer carry its portion of the interest. Monitor each venue’s APY separately against the Vanna borrow APR.

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Unwinding the position

Exit both deployment legs completely before withdrawing collateral:
1

Exit the Blend XLM leg

Go to Farm → select the Blend XLM pool → Remove Liquidity → withdraw your full XLM position from Blend.
2

Exit the Aquarius XLM/USDC leg

Go to Farm → select the Aquarius XLM/USDC pool → Remove Liquidity → withdraw your full XLM position from Aquarius.
3

Repay the XLM borrow

Go to Margin → Repay → repay the full XLM borrow including accrued interest using the XLM recovered from both pools.
4

Withdraw USDC collateral

Once the borrow is fully repaid, withdraw your USDC collateral back to your wallet.
Repay the XLM borrow in full before attempting to withdraw collateral. Partial repayment will leave the Health Factor constrained and block the collateral withdrawal.

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Risk profile

RiskLevelNotes
XLM price riskNear zeroXLM borrow and combined XLM farm exposure cancel
Liquidation riskMediumInterest accrues continuously against USDC collateral; HF declines over time
Rate risk (Blend leg)MediumTurns negative if Vanna borrow rate exceeds Blend XLM supply rate
Rate risk (Aquarius leg)MediumTurns negative if Vanna borrow rate exceeds Aquarius LP yield
Impermanent loss (Aquarius)LowXLM/USDC pool can suffer minor IL if the XLM/USDC ratio shifts significantly
Smart contract riskLowInherent to all on-chain protocols

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What to monitor

Both venue yields independently - Either leg can compress without affecting the other. Check Blend XLM supply APY and Aquarius XLM/USDC LP APY separately against the Vanna XLM borrow APR. Exit only the leg whose yield has dropped below its share of the borrow cost. Health Factor - With accumulated interest on a single XLM borrow, HF declines gradually over time. Add USDC collateral or partially exit one leg if HF falls below 1.5×.