Migrate iTokens to AAVE DSA

Learn how to migrate your iTokens to AAVE

This method is exclusively for v1 Lite Vaults. The v2 ETH vault operates on a multi-protocol strategy, making this feature unavailable.

You can use the following guide to breakdown your iTokens into their component parts of stETH collateral and ETH debt making them a standard AAVE position you can manage on Instadapp.

This guide will show you how to breakdown you iTokens and a little bit on unwinding on the Instadapp DApp if its your first time.

Preview of Actions:

  • Create a DSA account on Mainnet

  • Deposit iTokens to DSA

  • Execute Import Script

Visual Preview:

Create a DeFi Smart Account

If you already have a Mainnet Ethereum DeFi Smart Account you can skip this step.

The import script will migrate the iTokens as its AAVE position to the DeFi Smart Account. If you have never used standard Instadapp you can get started here: https://defi.instadapp.io/

The first time you reach Instadapp you will be asked to create an account.

The wallet is created on-chain and requires gas to be created.

Deposit iTokens to your DeFi Smart Account

You can now deposit your tokenized deposit from Instadapp Lite as iTokens into your DeFi Smart Account.

Once the deposit is confirmed you can find the iToken balance in the right side panel

Migrate the iTokens to your DSA

You can use the following spell (script) to migrate your iTokens and move your portion to your AAVE DSA. This will migrate the iTokens as their underlying stETH collateral and ETH debt. This migration utilizes a flashloan and will be charged our standard flashloan fee of 5 bps

Migrate iTokens as AAVE position to DSA

Migrate iTokens as AAVE position to DSA (higher flashloan capacity)

Once this transaction confirms you will find the iTokens as a position on AAVE in your DeFi Smart Account. Now you can return to the DeFi: https://defi.instadapp.io/

Managing your AAVE Position

Now you have a standard AAVE position on Mainnet. Most users would like to add collateral or unwind a part of the position. Here a quick step by step for users who never used Instadapp before.

We recommend using the Simulation Mode to test changes to your account before finalizing anything on chain. Simply click Simulation mode on the left side panel.

Depositing to your DSA to deposit to AAVE

When using a DSA you first deposit assets to your DSA then to the protocol. If you would like to add collateral to AAVE you first need to deposit it into the DSA.

In the AAVE protocol page, find Supply to add collateral to the AAVE position.

Utilizing the SAVE strategy to deleverage

You can use the SAVE strategy to deleverage the position. Remember if stETH is underpriced in ETH then you would be selling it at a loss.

Once your in the AAVE protocol page; on the right side panel you can find Strategies; in Strategies select SAVE

Here we imported 0.4 iETH into Instadapp as an AAVE position, Let's review the SAVE panel using an example:

In the example above we want to close the position i.e have no debt. From the top right going down:

  • We see the input of 0.9515 stETH to be used to payback ETH debt.

  • In the grey we see an estimate of the ETH received which is ~0.9025 ETH

  • This is a bit more than the debt owed 0.9015 ETH; this is because SAVE is a swap strategy and is not exact; so you can overpay a small bit here to make sure you have no remaining debt.

  • In this example we lose 0.05 ETH to fully unwind the position using stETH with its current depeg.

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