Humble Beginners Guide

Learn how to navigate Algorand's latest DeFi hub like a pro!

---

Welcome back to the Club, gov!

If you haven’t heard yet, Humble is one of our most anticipated dApps in the Algorand ecosystem due to their rockstar team and ambitious vision. 

We were pretty stoked when they launched at the end of March, but in early April Humble had to shut down when exploits in their smart contracts were identified. Luckily no funds were stolen as the vulnerability was caught before any bad actors had a chance to capitalize.

Now, after working over two months to improve their overall security and features, Humble has relaunched.

And we couldn’t be more excited.

In addition to relaunching with a DEX, yield farming, and liquidity mining, Humble has also received 2 million ALGOs in Aeneas rewards to help grow their TVL and reward early adopters. And to make it even better, the participating ASAs are matching up to $250K USD value in their tokens.

In this guide, we’ll review what Humble is, strategies for all skill levels, and how to use the platform.

To make this guide easier to navigate, we’ve included the table of contents below:

• What is Humble DeFi?

• Humble Strategy Guide

• Humble How-To Guide

  • How to Swap

  • How to Provide Liquidity

  • How to Farm

  • How to Personalize Settings

  • How to Buy ALGO

Okay, let’s dive in.

What is Humble DeFi?

Humble is a DeFi suite being built on Algorand that when fully operational will include a wide range of features: a DEX, yield farming, liquidity mining, stablecoin pools, derivatives, cross-chain functionality (i.e. cross-chain swaps), a customer support help desk, and much more. 

Gov Tip: Humble is built on the Reach, a blockchain agnostic programming language.

Check out their roadmap below to see their upcoming features:

With all that being said, only the DEX, yield farming, and liquidity mining are available at this time. 

But that’s all we need to make some A. 

As mentioned above, Humble was awarded 2 million ALGOs through the Aeneas Fund to assist in the growth of their TVL by rewarding early adopters. These ALGOs will be distributed through liquidity mining / farming of their ALGO/ASA and ALGO/USDC liquidity pools. 

With Aeneas rewards and high APRs, there are plenty of ways to earn on Humble. 

Humble Strategy Guide

Disclaimer: Reminder that this isn’t financial advice. We’re presenting these strategies as thought starters and we encourage you to do your own research to make these strategies fit your own personal needs and goals.

In the following guide we will present strategic frameworks for three different DeFi skill levels: beginner, enthusiast, and pro with tips on how to level up each. We will grade each strategy on both their passive and risk levels on a scale between 1 - 3 with 1 being the least risky or passive and 3 being the most. Additionally, we will list the risks to each strategy for your consideration.

We recommend choosing the skill level appropriate to you to start, and then progressing through our “Level Up” tips (which make each strategy more risky) before graduating to the next skill set. Or you can even mix and match the strategies below as you see fit – whatever it is, remember to make the strategy your own.

Gov Tip: Go slow and small at first if you need to – there is no shame in learning first. There will be plenty of opportunities to make ALGO in the future. Remember: we are early!

DeFi Beginner

Passive Level: 3 (Most Passive)

Risk Level: 1 (Least Risky)

Risks: Smart contract hacks, oracle failures, impermanent loss

Strategy Summary: Pick a pool that has an ASA you’re long-term bullish on and provide liquidity to it. The goal is to “set it and forget it” until Aeneas rewards are dried up and to do this you need to take the worry of impermanent loss out of the equation by selecting an ASA you don’t mind swapping ALGO for. Let the pool DCA in and out of the ASA while you earn passive income on your position. 

To execute this strategy follow the steps below:

If you want to level up your DeFi game on Humble, continue onto the DeFi enthusiast strategy below.

DeFi Enthusiast Strategy

Passive Level: 2 (Moderately Passive)

Risk Level: 2 (Moderate Risk)

Risks: Smart contract hacks, oracle failures, impermanent loss 

Strategy Summary: Supply liquidity to ALGO/USDC pool to earn Aeneas rewards and a high APR. Executing this strategy will require more work and risk than the Beginner strategy as you will need to monitor the price of ALGO to avoid impermanent loss. However, this is a less risky strategy overall that can provide stellar returns if played correctly.

If you have experience with DeFi, particularly impermanent loss, this is a strategy you may want to research more.

To execute this strategy follow the steps below:

You can level up this strategy by preparing for all outcomes:

• In the event the market trades sideways: Sit tight, remain patient, and collect your Aeneas rewards and taker fees.

• In the event the price of ALGO drops significantly below your LP entry price: Pull liquidity and convert remaining USDC to ALGO if ALGO’s price drops further.

• In the event there’s a relief rally after you provide liquidity: Pull liquidity and convert remaining ALGO to USDC. Buy ALGO back once the price comes back down. 

  • Gov Tip: Level this up further by swapping your accrued ALGO rewards for USDC to take an additional short position. Buy back once the rally is sold off.

DeFi Pro Strategy

Passive Level: 1 (Least Passive)

Risk Level: 3 (Riskiest)

Risks: Impermanent Loss, bad judgment call(s), smart contract hacks, slippage, oracle failures

Strategy Summary: Take a short position against ALGO using Humble’s DEX. Executing this strategy requires more research and work than the others, but has potential to provide the highest return. However, as you know, more rewards are typically always offset with more risk. 

To execute this strategy follow the steps below:

Gov Tip: Don’t be led through this process by a “hunch” or because an “influencer” told you something was going to happen. That’s how you get rekt.

You can level this strategy up by increasing your overall investment amount. This might be something you want to consider if you have a strong conviction on a particular outcome and you have your own research and data to support that belief.

Now that you have an understanding of the types of strategies you can deploy, let’s review how to use Humble.

Humble How-To Guide

Humble’s UI is slick and easy to use. As of June 22nd, users can do the following:

• Swap tokens

• Provide liquidity

• Farm liquidity pool tokens

Let’s review how to do each.

How to Swap 

After connecting your wallet, navigate to the Swap page of you aren’t already there:

Use the drop down menus to select the two tokens you would like to swap between and then input the amount you want to swap:

Before you finalize the swap, review the risk (price impact & slippage) involved by using the drop down:

Gov Tip: Review the exchange rate, swap fees, minimum received, and pool liquidity on these screens as well to make sure everything matches your standards.

Finalize the swap by selecting “Swap Tokens” and “Confirm” before signing the transaction with your wallet:

Nice and easy, isn’t it? If you’ve used a DEX before you should feel right at home. Now that you know how to swap on Humble, let’s review how to provide liquidity next.

How to Provide Liquidity

Navigate to the Pool page to start this process:

Determine the pool you want to provide liquidity to and then select “Add”:

On the following screen, input the amount you want to provide to the pool and select “Add Liquidity” when you’re ready to move on. Finalize the transaction by selecting “Confirm” and signing it with your wallet.

Gov Tip: Remember the amount you supply of each asset needs to be equivalent in value (i.e., 100A = 33 USDC when ALGO’s price is $0.33)

Review your share of pool and add or remove liquidity by using the “Your Liquidity” menu at the top of the “Pool” screen:

Now that you’re a liquidity provider, it’s time to supercharge your earnings with farming.

How to Farm

To begin farming your liquidity pool tokens (LPTs), navigate to the Farm page:

Select the LPTs you want to farm by using the drop down menu and selecting ‘Stake’:

Select ‘100%’ to stake all your LPTs and click ‘Stake’ when you’re ready. Finalize the transaction by signing it with your wallet.

Review the pools you’ve provided liquidity to by checking ‘My Farms Only’ at the top of the screen:

To claim your rewards or add and remove LPTs, use the drop-down menu and select the respective option:

Gov Tip: Unstaking automatically claims your unclaimed rewards.

And just like that you’re earning some serious passive income.

Before you go, let’s review a few more miscellaneous items on Humble starting with your settings.

How to Personalize Settings

Select the gear icon in the upper right to open the settings menu:

From here you can switch the protocol to dark mode (pictured above), change the overarching currency unit, and set your slippage tolerance.

How to Buy ALGO

You can buy ALGo directly on Humble by selecting ‘Buy ALGO via Wyre’ at the top of the screen:

Input the amount of ALGO you want to purchase and select the ‘Buy ALGO’ button. Input your payment information to finalize this process.

Gov Tip: Learn more about Wyre here.

And if you ever need help you can select the chat box in the bottom left to talk with live support. How cool is that, gov?

And now you know how to use Humble like a pro! If you want to learn more about Humble, check out their FAQs or pop into their Discord to chat with the team directly.

As always, thanks for dropping by the Club. 

Until next time, gov!

---

Disclaimer: This isn’t financial advice! As we say in crypto, don’t trust – VERIFY! Do your own research to determine if Humble is right for you and don’t ever invest more than you’re willing to lose. 

Like any DeFi project, Humble comes with risks:

Impermanent Loss: When you provide liquidity to a LP and the price of your deposited assets changes compared to when you deposited them, you can experience impermanent loss. The LP is programmed to maintain a constant value between two tokens, so arbitrage traders will use the pool to swap the two tokens until the necessary constant value is achieved. 

This is an important concept to grasp, and we highly recommend you do a deep dive into impermanent loss before becoming a liquidity provider. We recommend this video and article from Binance Academy as a starting point.

Slippage: Slippage occurs when a trade settles for an average price that is different than what was initially requested, and it often happens when there's not enough liquidity to complete your order or the market is volatile. This leads to the final order price changing. 

Smart contract failure: By interacting with the protocol, users expose themselves to the risk of smart contract failures / hacks. Despite dApps undergoing rigorous audits, there is always a chance of this in DeFi. 

Oracle Risk: In addition to smart contract failures, there is the risk the oracles used by the protocol provide incorrect or stale data.

Not Self-Sovereign: By providing liquidity, users forfeit control of their assets and expose themselves to all the risks mentioned above. This is not unique to PactFi and is true with any DeFi dApp you lend, stake, farm, or provide liquidity on. When you take these actions, you forfeit your self-sovereign rights over your assets.