Deep dive: This guide covers stETH-specific strategies. For general leverage mechanics, profit formulas, and position management, see Leverage.
Amplify your staking yields using Lido's stETH with Stormbit's risk-transferred model.
Overview
Node operators and stakers can leverage their stETH/wstETH positions to amplify staking yields. Stormbit's risk transfer model is particularly powerful for correlated assets like stETH/ETH.
Why Leverage stETH with Stormbit?
For Node Operators
Node operators know their performance better than anyone. Stormbit lets them trade on that knowledge — leverage staking exposure with risk reduced to one factor: operational performance.
Unlike traditional protocols where you're exposed to price volatility, liquidation cascades, and variable rates requiring constant monitoring, Stormbit eliminates everything except node performance risk. You already manage node performance. Now that's your only risk.
How It Works
Step by Step
Deposit stETH as collateral
Borrow ETH at rate locked at origination (40-day term typical)
Stake borrowed ETH → receive more stETH
Repeat to target leverage (~10x)
Repay at maturity, keep the spread
Rolling terms enable continuous exposure.
Economics
Comparison with Alternatives
Protocol
LTV
Leverage
Borrow Rate
Liquidations
APY
Morpho
93%
8.6x
1.61% var
Yes
11.82%
Aave
93%
8.6x
1.97% var
Yes
9.09%
Stormbit
95%
10.3x
2.20% locked
Risk transferred
8.35%
Based on 2.8% staking yield baseline
APY vs Performance
Borrow rate is locked at origination. APY depends only on your staking performance:
Performance
Staking Yield
Borrow Cost
Net APY (10x)
Strong
3.5%
2.2%
+13%
Average
2.8%
2.2%
+6%
Weak
2.0%
2.2%
-2%
Key insight: You only lose money if your staking yield drops below the borrow rate locked at origination.
Strategies
Yield Amplification (Aggressive)
For aggressive leverage users, Stormbit's risk transfer model enables higher LTV on shorter terms:
Max Safe
Optimized
LTV
90%
98%
Leverage
10x
50x
APY
13.3%
48.9%
30-day terms, assuming 2.8% staking yield
Treasury Liquidity (Conservative)
For DAO treasury or long-term holders needing liquidity without liquidation anxiety:
Morpho (Variable)
Stormbit (Fixed)
Max Safe LTV
35%
55%
Liquidity Unlocked
$3.5M per $10M
$5.5M per $10M
Borrow Rate
~4.5%
~8.2%
Liquidation Risk
High
Zero during term
+57% more capital for ~3.7% extra APR — and sleep-well certainty.
Why stETH/ETH Works
Correlation Advantage
stETH and ETH are highly correlated:
stETH is backed 1:1 by ETH
Depeg events are temporary
Historical depegs have always recovered
Stormbit Protection
Even during a depeg event:
Traditional: Liquidated when stETH/ETH ratio drops
Stormbit: Protected until maturity
If stETH depegs 5% temporarily:
Risk Analysis
Your only risks with stETH leverage:
Staking yield < borrow rate
Break-even at ~0.22% yield (at 10x)
Very unlikely for extended periods
Protocol risk
Lido smart contract risk
Stormbit smart contract risk
Mitigated by audits and track record
stETH permanent depeg
Would require Lido protocol failure
Extremely unlikely
Getting Started
For Operators: Loop Setup
Obtain stETH from your staking operations
Create or find Term with stETH collateral support
Create Loan with stETH collateral, borrowing ETH
Stake ETH to get more stETH
Add stETH to collateral
Borrow more ETH
Repeat until target leverage
For Lido v3 stVaults
Stormbit provides a new use case for Lido v3 stVaults:
Operators can leverage vault positions
Users can bet on specific node performance
Revenue sharing opportunity
Summary
Feature
Details
Collateral
stETH, wstETH
Max LTV
95%+
Term
7-40 days typical
Liquidation
None during term
Target users
Node operators, DAO treasury
Key benefit
Focus on staking, not risk management
Technical Details
The following section contains technical information for developers and integrators.
Revenue Sharing
See Fee Structure for protocol fee details. Lido receives 30% of the protocol fee as revenue share.
