This vault provides liquidity to the wstETH/ETH pool on Balancer, stakes the LP tokens on Aura, and then periodically harvests and reinvests the BAL and AURA token incentives.
The vault converts some of the borrowed ETH into wstETH and both are provided as liquidity to the Balancer pool. The vault then stakes the LP tokens on Aura.
Redemption / Settlement
The LP tokens are removed from Aura, and redeemed for ETH and wstETH on Balancer. The wstETH is then converted to ETH and returned to Notional.
Smart Contract Risk
This vault involves smart contract risk and liquidation risk. Funds can be negatively impacted due to a bug in Notional, Balancer, Lido, or Aura.
Users of this vault make money when the stETH/ETH exchange rate increases and lose money when the exchange rate decreases. If the stETH/ETH exchange rate decreases too much, users can be liquidated.
Entering and exiting this vault involves swapping between ETH and stETH which causes transaction cost. Higher leverage ratios mean larger ETH/stETH swaps and larger transaction cost.