optimizing-defi-yields

Prerequisites

Before using this skill, ensure you have:

• Access to crypto market data APIs (CoinGecko, CoinMarketCap, or similar)
• Blockchain RPC endpoints or node access (Infura, Alchemy, or self-hosted)
• API keys for exchanges if trading or querying account data
• Web3 libraries installed (ethers.js, web3.py, or equivalent)
• Understanding of blockchain concepts and crypto market dynamics

Instructions

Step 1: Configure Data Sources

Set up connections to crypto data providers:

1. Use Read tool to load API credentials from {baseDir}/config/crypto-apis.env
2. Configure blockchain RPC endpoints for target networks
3. Set up exchange API connections if required
4. Verify rate limits and subscription tiers
5. Test connectivity and authentication

Step 2: Query Crypto Data

Retrieve relevant blockchain and market data:

1. Use Bash(crypto:yield-*) to execute crypto data queries
2. Fetch real-time prices, volumes, and market cap data
3. Query blockchain for on-chain metrics and transactions
4. Retrieve exchange order book and trade history
5. Aggregate data from multiple sources for accuracy

Step 3: Analyze and Process

Process crypto data to generate insights:

• Calculate key metrics (returns, volatility, correlation)
• Identify patterns and anomalies in data
• Apply technical indicators or on-chain signals
• Compare across timeframes and assets
• Generate actionable insights and alerts

Step 4: Generate Reports

Document findings in {baseDir}/crypto-reports/:

• Market summary with key price movements
• Detailed analysis with charts and metrics
• Trading signals or opportunity recommendations
• Risk assessment and position sizing guidance
• Historical context and trend analysis

Output

The skill generates comprehensive crypto analysis:

Market Data

Real-time and historical metrics:

• Current prices across exchanges with spread analysis
• 24h volume, market cap, and circulating supply
• Price changes across multiple timeframes (1h, 24h, 7d, 30d)
• Trading volume distribution by exchange
• Liquidity metrics and slippage estimates

On-Chain Metrics

Blockchain-specific analysis:

• Transaction count and network activity
• Active addresses and user growth metrics
• Token holder distribution and concentration
• Smart contract interactions and DeFi TVL
• Gas usage and network congestion indicators

Technical Analysis

Trading indicators and signals:

• Moving averages (SMA, EMA) and trend identification
• RSI, MACD, Bollinger Bands technical indicators
• Support and resistance levels
• Chart patterns and breakout signals
• Volume profile and accumulation zones

Risk Metrics

Portfolio and position risk assessment:

• Value at Risk (VaR) calculations
• Portfolio correlation and diversification metrics
• Volatility analysis and beta to market
• Drawdown statistics and recovery times
• Liquidation risk for leveraged positions

Error Handling

Common issues and solutions:

API Rate Limit Exceeded

• Error: Too many requests to crypto data API
• Solution: Implement request throttling; use caching for frequently accessed data; upgrade API tier if needed

Blockchain RPC Errors

• Error: Cannot connect to blockchain node or timeout
• Solution: Switch to backup RPC endpoint; verify network connectivity; check if node is synced

Invalid Address or Transaction

• Error: Blockchain address format invalid or transaction not found
• Solution: Validate address checksums; verify network (mainnet vs testnet); allow time for transaction confirmation

Exchange API Authentication Failed

• Error: Invalid API key or signature mismatch
• Solution: Regenerate API keys; verify permissions (read/trade); check system clock synchronization for signatures

Resources

Crypto Data Providers

• CoinGecko API for market data across thousands of assets
• Etherscan API for Ethereum blockchain data
• Dune Analytics for on-chain SQL queries
• The Graph for decentralized blockchain indexing

Web3 Libraries

• ethers.js for Ethereum smart contract interaction
• web3.py for Python-based blockchain queries
• viem for TypeScript Web3 development
• Hardhat for local blockchain testing

Trading and Analysis Tools

• TradingView for technical analysis and charting
• Glassnode for advanced on-chain metrics
• DeFi Llama for DeFi protocol analytics
• Nansen for wallet tracking and smart money flows

Best Practices

• Never store private keys or seed phrases in code
• Always verify smart contract addresses from official sources
• Use testnet for experimentation before mainnet
• Implement proper error handling for network failures
• Monitor gas prices before submitting transactions
• Validate all user inputs to prevent injection attacks