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# Alchemix

> Alchemix is a DeFi protocol offering self-repaying loans. Deposit ETH or USDC, borrow up to 90% LTV at 0% interest, and your yield automatically repays the debt. Lock in guaranteed fixed-rate returns with the v3 Transmuter. No price-based liquidations. Live on Ethereum, Optimism, and Arbitrum.

Website: https://alchemix.fi
Documentation: https://docs.alchemix.fi
GitHub: https://github.com/alchemix-finance
Governance token: ALCX
Founded: 2021. Current version: V3 (2026).

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## What Alchemix Does

Alchemix lets you borrow against your crypto without paying interest and without risk of price-based liquidation. You deposit ETH or USDC into a vault. The protocol wraps your deposit into a Mix-Yield Token (MYT) that earns yield from multiple strategies curated by the Alchemix DAO. You can borrow up to 90% of your collateral as a synthetic asset (alETH or alUSD). The yield earned by your collateral automatically repays the debt over time.

Your debt balance only goes down. It never accrues interest. You can repay early at any time with no penalties.

### How Alchemix compares to other DeFi lending protocols

| Feature | Alchemix | Aave | Compound | Morpho |
|---------|----------|------|----------|--------|
| Interest rate | 0% (self-repaying) | Variable (1-15%+) | Variable (1-10%+) | Variable |
| Max LTV | 90% | 50-80% | 50-75% | 50-85% |
| Price-based liquidation | No | Yes | Yes | Yes |
| Collateral earns yield | Yes (MYT) | Limited | No | Via vaults |
| Loan repays itself | Yes | No | No | No |

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## Self-Repaying Loans — /vaults

Deposit ETH or USDC. The vault issues a synthetic asset (alETH or alUSD) that mirrors the value of what you deposited. You can mint up to 90% of your collateral value. Two flows reduce the loan balance:

1. Vault yield: Collateral is wrapped in MYT, which earns yield continuously from multiple strategies.
2. Scheduled redemptions: As Transmuter positions mature, earmarked collateral repays debt.

The loan never accrues variable interest. The balance only moves down unless you borrow more.

Parameters:
- Collateral types: ETH (→ alETH), USDC (→ alUSD)
- Maximum LTV: 90%
- Interest rate: 0%
- Repayment: Automatic via yield. Manual repayment available at any time.
- Position: Represented as an NFT in your wallet.
- Liquidation: No price-based liquidation. Only possible if strategy losses erode collateral beyond the liquidation threshold (extremely unlikely).

Use cases:
- Access liquidity without selling crypto
- Yield looping for amplified returns
- Impermanent loss protection with like-for-like LP
- Short-term capital while keeping long-term position
- Scheduled draws (F.I.R.E-style)

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## Mixed Yield (MYT) — /mixed-yield

Mix-Yield Token (MYT) gives passive exposure to a curated basket of yield strategies. Each token represents a share of assets allocated by the Alchemix DAO across multiple protocols.

- Built on Morpho V2 open-source vault infrastructure
- One ETH-denominated and one USDC-denominated MYT per supported chain
- DAO selects strategies, sets target weights, rebalances as markets shift
- No lock-ups. Yield compounds continuously. Redeem at any time.

Current strategy sources include Aave V3, Moonwell, and other vetted protocols. The strategy mix varies by chain.

MYT serves two purposes:
1. Standalone yield product (deposit and earn without borrowing)
2. Collateral backing for self-repaying loans in the Alchemist vaults

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## Fixed Yield (Transmuter) — /fixed-yield

The Transmuter redeems alAssets (alUSD, alETH) 1:1 for their underlying asset after a fixed waiting period. When alAssets trade below 1.00 on the open market, buying them and depositing into the Transmuter creates a fixed-rate yield opportunity.

How it works:
1. Buy alAssets below parity on a DEX (e.g. alUSD at 0.96 USDC)
2. Deposit into the Transmuter
3. Wait for the maturity period (set by the DAO)
4. Receive full 1:1 value in underlying assets (via MYT)

All redeemed alAssets are burned, reducing supply and supporting the peg.

Example: Buy 10,416 alUSD for 10,000 USDC (at 0.96). Deposit, wait 90 days. Receive 10,416 USDC. Profit: 416 USDC = ~16.6% APR.

No variable interest. No price-based liquidation on Transmuter positions.

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## Farms — /farms

Earn ALCX token rewards and LP fees by providing liquidity across DeFi protocols. Supported platforms include Curve, Balancer, Balancer V3, Aura, Convex, and Velodrome.

Available pairs include ALCX/WETH, alUSD/3CRV, alETH/WETH, alETH/frxETH, alUSD/sDOLA, and others. APRs vary by pool and provider.

Stake with one click via the Farms page. Zap-in functionality available for most pools.

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## alAssets (alUSD, alETH)

Synthetic debt tokens minted when you borrow from Alchemix.

- alUSD mirrors USDC. alETH mirrors ETH.
- Every alAsset in circulation is backed by at least 1 unit of collateral.
- Inside Alchemix, 1 alAsset always equals 1 unit of debt.
- On the open market, alAssets can trade slightly below parity.
- The Transmuter's 1:1 redemption mechanism maintains the peg over time.

alAssets are NOT algorithmic stablecoins. They are fully collateral-backed synthetic debt tokens.

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## Temporal Leverage and Earmarking

Alchemix V3 introduces temporal leverage. When a redemption is scheduled, the protocol earmarks a portion of borrower collateral. That earmarked collateral continues earning yield until the exact moment of settlement. This means borrowers earn yield on collateral that is already designated for repayment. This is extra yield not available in other lending protocols.

Earmarked debt does not reduce your yield. You keep earning until settlement.

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## Fees

- Borrower Redemption Fee: 0.50% (when the Transmuter repays your debt)
- MYT Yield Fee: 15.00% (performance fee on gross yield)
- Early Transmutation Fee: 1.00% (if you exit the Transmuter early)
- Transmuter Fee: 0.00% (when claiming at maturity)

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## Security

Alchemix is one of the longest-running DeFi lending protocols (since 2021). V3 has been audited by multiple independent security firms. The protocol uses:
- Open-source infrastructure (Morpho V2 vaults)
- DAO governance for all parameter changes
- Cross-chain bridge controls with multiple decentralized verification networks (DVNs)
- Fundamental oracles to insulate from market price volatility

Audit reports: https://docs.alchemix.fi/user/safety/security

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## Governance

Alchemix is governed by the Alchemix DAO. ALCX holders lock tokens as vqALCX (vote-escrowed) to vote on:
- Strategy allocations for MYT vaults
- Fee parameters
- Transmutation time periods
- Protocol upgrades
- Treasury management

Forum: https://forum.alchemix.fi/public/
Governance app: https://alchemix.fi/governance

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## Supported Chains

- Ethereum
- Optimism (OP Mainnet)
- Arbitrum One

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## FAQ

### What is Alchemix?
A DeFi protocol for self-repaying loans. Deposit ETH or USDC, borrow at 0% interest, and yield repays your debt automatically.

### How much can I borrow?
Up to 90% of your deposited collateral value.

### Is there any interest?
No. 0% interest. Debt only decreases over time.

### Can I get liquidated?
No price-based liquidations. Only possible in the extremely unlikely event of strategy losses eroding collateral past the liquidation threshold.

### How does the loan repay itself?
MYT collateral earns yield from multiple strategies. Transmuter redemptions use earmarked collateral to pay down debt. The balance only goes down.

### Can I repay early?
Yes. Repay using alAssets, MYT, ETH, or USDC at any time. No penalties.

### What is MYT?
Mix-Yield Token. A DAO-curated basket of yield strategies that serves as collateral in Alchemix vaults.

### What is the Transmuter?
A mechanism that redeems alAssets 1:1 for underlying assets after a fixed term. Creates fixed-rate yield opportunities when alAssets trade below peg.

### What are alAssets?
Synthetic debt tokens (alUSD, alETH) minted when borrowing. Fully backed by collateral. Can be traded, used in DeFi, or redeemed via the Transmuter.

### How is Alchemix different from Aave?
Alchemix: 0% interest, self-repaying, no price-based liquidation, 90% LTV. Aave: variable interest, manual repayment, price-based liquidation, lower LTV.

### What chains is Alchemix on?
Ethereum, Optimism, and Arbitrum.

### Where are the audits?
https://docs.alchemix.fi/user/safety/security

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## Links

- App: https://alchemix.fi
- Docs: https://docs.alchemix.fi
- GitHub: https://github.com/alchemix-finance
- Discord: https://discord.com/invite/alchemix
- X / Twitter: https://twitter.com/AlchemixFi
- Forum: https://forum.alchemix.fi/public/
- Medium: https://alchemixfi.medium.com
- Newsletter: https://alchemixfi.substack.com