# What is Contango? Contango lets you loop anything on-chain. You can: * Create leveraged positions similar to perps, but with low funding. * Lever up on the yield of liquid staking and restaking assets, such as stETH or eETH. * Lever up on the fixed yield of Pendle's PTs. * Create delta neutral plays to farm funding rates. * Arbitrage rate differentials on stablecoins. * Farm rewards, airdrops, and points with leverage. And much more! See all its [use cases](https://docs.contango.xyz/basics/use-cases). The architecture behind Contango makes it the ultimate [looping](https://docs.contango.xyz/basics/what-is-looping) layer in defi. Regardless of whether you use the [Advanced](https://docs.contango.xyz/app/advanced) or the [Simplified](https://docs.contango.xyz/app/simplified) interface, all positions are built by automating a looping strategy, using spot and money markets. Likewise, regardless of the type of user you are - [trader, looper, farmer](https://docs.contango.xyz/basics/whos-this-for) - you'll always find a use case to trade on Contango. Here's a 1-min explainer: {% embed url="" %} ## Why is this design superior? #### **You can trade on the deepest liquidity in defi** Contango builds positions on top of [spot](https://docs.contango.xyz/resources/glossary#spot-market) and [money markets](https://docs.contango.xyz/resources/glossary#money-market). By aggregating the +$20B liquidity of spot markets and tapping into the +$40B liquidity of money markets, Contango can facilitate large trades with minimal impact on both rates and price. #### **You get the cheapest and least volatile funding rates in crypto** Funding rates (shown as [APY](https://docs.contango.xyz/resources/glossary#apr) on Contango) are determined by the difference between the lending and borrowing rates on the money markets. This mechanism offers the best funding rates in the industry, around 3x cheaper and less volatile than market leaders, like Binance and dYdX ([full study](https://medium.com/contango-xyz/why-you-should-trade-on-leverage-using-money-markets-93b988fc69ec)). These APY values can be positive or negative, offering traders a chance to collect them via arbitrage. #### You can pick your favourite chain and market Contango is composable by design. It can offer a trading pair on any chain as long as there is a spot and a lending market for that. Currently you can choose among 6 chains, 13 money markets and [more than +200 trading pairs](https://docs.contango.xyz/key-features#more-than-160-trading-pairs). The ability to trade the same instrument on different markets and chains is great for diversification purposes too. Don't see a money market or an asset you'd love to trade? Just tell us. #### You can farm rewards and points while trading By design, almost all rewards, incentives or points offered by the underlying money markets will be accrued by traders on Contango. Contango already offers point-farming pairs on Ethena, Etherfi, Renzo, EigenLayer, Aave Merit rewards. Airdrop criteria from underlying protocols also apply to Contango traders, like the SPK airdrop from Spark (see [this section](https://docs.contango.xyz/key-features#rewards-incentives-points) for more details). That’s the beauty of DeFi composability. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.contango.xyz/basics/what-is-contango.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.