Recently, a phenomenon worth paying attention to has emerged: there is a significant spread between on-chain lending market interest rates and the yields from mainstream exchange stablecoin investment products. Some are already capitalizing on this spread. Let’s take a look at how to operate specifically.

**Where does the spread come from?**

Currently, lending protocols like ListDAO are quite conservative with stablecoin lending rates—some popular collateral assets are even as low as around 1%. In contrast, top exchanges’ stablecoin investment products often offer annualized yields of 10%-20%, making the gap quite substantial. A simple calculation: if you can borrow stablecoins at 1% cost and then invest them to earn 20%, the 19% difference could be your potential profit. Plus, your original collateral (such as BTC, BNB, or other blue-chip assets) remains in place, possibly sharing in the upside.

**How to participate? A few steps**

First, deposit your idle mainstream assets into protocols like ListDAO. BNB, Bitcoin, Ethereum—these are all good options. Instead of letting them sit idle in your wallet, put your funds to work.

Next, lend out stablecoins. Depending on your collateral size, you can directly borrow USD1 or other stablecoins. At this stage, the borrowing cost is basically negligible.

Then, deposit the borrowed stablecoins back into an exchange to invest in savings or fixed-term investment products. This step is straightforward—funds go in, and yields start accumulating.

Finally, wait for the returns. Daily income from investment products and the interest on your loans will generate a net spread that keeps growing.

**Advanced strategies**

Some users hold interest-bearing tokens like PT-USDe or asUSDF, which can also be used as collateral. What’s the benefit? These tokens generate income themselves, and after collateralizing them in protocols, they continue to earn yields while you can borrow stablecoins for investment. It’s like leveraging the same asset multiple times, maximizing capital efficiency.

The core idea of this approach is to exploit yield differences between various on-chain products, using lending as leverage to shift low-cost funds into high-yield scenarios. Of course, every strategy has its risks—such as collateral price fluctuations and liquidation risks—so be aware of these. From a pure arbitrage perspective, this mechanism indeed exists, and the data is available. If interested, you can look into the specific lending conditions of relevant protocols and the details of exchange investment products to assess the feasibility of participation yourself.