Multiply

Pike's Multiply feature enables users to amplify their exposure to assets through automated leveraged positions using flash loans and atomic transactions.

Overview

Multiply automates the creation of leveraged positions by combining flash loans, automated market making, and Pike's lending protocol. Users can achieve up to 10x leverage in a single transaction without the complexity and cost of manual looping.

The sections below cover leverage calculations, APY formulas, E-mode requirements and fee structures

How Multiply Works

Multiply automatically creates leveraged positions by combining flash loans with Pike's lending protocol. When you create a Multiply position, the protocol uses a flash loan to borrow additional assets, converts those assets to collateral through automated swaps, and then supplies the combined collateral to Pike. The protocol then borrows against this new collateral to repay the flash loan, leaving you with a leveraged position where your original deposit controls a larger amount of collateral.

The entire process happens atomically in a single transaction, either everything succeeds or the transaction reverts, ensuring your position is always in a valid state.

Key Properties:

  • Atomic Execution: All steps succeed together or the entire transaction reverts

  • No Manual Steps: Protocol handles all intermediate operations automatically

  • Instant Setup: Position is fully configured in one transaction

Leverage & Multipliers

Understanding Multipliers

The multiplier determines how much leverage you apply to your position. For example:

  • 2x multiplier: Your $1,000 deposit creates a $2,000 total collateral position

  • 5x multiplier: Your $1,000 deposit creates a $5,000 total collateral position

  • 10x multiplier: Your $1,000 deposit creates a $10,000 total collateral position

Higher multipliers amplify both potential returns and risks.

Leverage APY

Your effective APY on a Multiply position from lending activities is calculated as:

Leverage APY = (Multiplier × (Supply APY - Borrow APY)) + Borrow APY

Formula factors:

  • Multiplier: Your chosen leverage level (e.g., 2x, 5x, 7.5x)

  • Supply APY: Annual percentage yield earned on your collateral deposited in Pike

  • Borrow APY: Annual percentage yield paid on your borrowed assets

  • Leverage APY: Your net APY from the leveraged lending position

Example:

With a 5x multiplier, 8% Supply APY, and 4% Borrow APY:

Leverage APY = (5 * (8% - 4%)) + 4%
             = (5 * 4%) + 4%
             = 20% + 4%
	     = 24%

E-Mode Requirements

Multiply strategies require E-mode (Efficiency Mode) to function:

  • Higher LTV Ratios: E-mode provides higher borrowing capacity for correlated assets

  • Increased Leverage: Higher LTV enables greater multipliers (up to 10x)

  • Risk Optimization: E-mode's asset correlation reduces systemic risk

Category-Based Strategies

Each Multiply strategy is designed for a specific E-mode category:

  • Strategies use correlated assets (e.g., stablecoins with stablecoins)

  • E-mode category determines the LLTV and maximum multiplier

  • You must be in the correct E-mode category to use a strategy

Fees & Costs

Understanding the fees involved in Multiply operations helps you evaluate the total cost of your leveraged position.

Flash Loan Fees

A small fee charged for borrowing assets via flash loans to create your position. This fee varies by strategy.

Swap Fees

When the protocol converts borrowed assets to collateral, swaps are executed through a DEX aggregator and Tapio liquidity pools. DEX swaps incur standard fees and are subject to market slippage based on your tolerance settings

Protocol Fees

For more details, please refer to the Protocol Fees page

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