I've been farming on Earn+ on @EthenaPay, and so far, so good. But who's actually paying for the 12% APY? Whenever I farm, I like to understand where the yield comes from, and how sustainable it is. So I did some digging. Under the hood, Earn+ runs a leveraged USDe strategy on @aave V4 Avalanche, managed by @SteakhouseFi with vault infrastructure from @upshift_fi. Here's how it works: 1. Supply USDe as collateral. 2. Borrow USDT against it. 3. Swap USDT into more USDe. 4. Repeat, targeting around 11x leverage. But to make this strategy work, you need two things: First, enough USDT liquidity to borrow. This is where Avalanche's incentive program comes in. Avalanche Foundation committed up to $15M in incentives to bootstrap Aave V4 on Avalanche. USDT lenders have also been receiving additional WAVAX incentives through Merkl, making it more attractive to provide liquidity. Without sufficient USDT liquidity, leveraged strategies like Earn+ would struggle to scale. Second, enough yield on the USDe collateral. Interestingly, USDe currently earns 0% base supply APY on Aave V4 Avalanche. The additional return comes from USDe rewards earned on the larger leveraged position, rather than Aave's ordinary supply interest. There are also separate USDe incentive campaigns distributed through Merkl, although the exact portion captured by Earn+ isn't publicly confirmed. So here's the interesting part: • USDT lending incentives help attract liquidity. • USDe rewards make the leveraged position profitable. • Earn+ amplifies the difference through leverage, after borrowing costs. Essentially, multiple incentive mechanisms help make a 12% yield product possible. But what happens when those incentives eventually disappear? If USDe rewards decline or USDT borrowing becomes more expensive, the APY could fall significantly. There's also a concentration risk worth remembering. If you already have stablecoins deposited on Aave, allocating additional funds to Earn+ isn't necessarily diversification. You're still exposed to Aave's underlying infrastructure, with added leverage and vault risks. While my experience with Earn+ has been positive so far, I wouldn't treat the advertised 12% APY as a guaranteed long-term return. The most important question when farming yield isn't just how much you're earning. It's who's paying for it, why they're paying, and how long they can keep paying.