atf is what we used in our grass drag sleds. its cheap especially when you`re trying differant gears and have the cover off a bunch of times. the bearings in the chaincase are sealed and atf will do a good job keeping the chain lubed
I use mopar ATF+4. If it can handle 430ft. lbs. of torque in a 5000lb vehicle for thousands of miles, it should be able to handle the load of a sled. All 4x4 trucks use a chain in the transfer case, and they all recomend some sort of ATF for lube.
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