Fundamentally, the earning opportunities through digital assets, including cryptocurrencies, have increased with the help of countless technical integrations and the portfolios of common investors have grown. The method of “Staking” has emerged as just as profitable as Mining or Trading.
Staking can be broadly defined as a medium that serves to increase one’s own asset portfolios without having a direct influence on it, as it is a practical way of keeping investments going, which generates interest and rewards.
Nevertheless, it should not be left unmentioned that every asset with a high return on investment, whether mining or trading, is associated with a certain risk, which includes: high fees and the unavailability of the assets up to a certain point in time, as they are locked through the Staking Contracts.
The process of staking is compared in FinTech circles with depositing money at a bank, where an investor locks his assets and is rewarded with interest in return. In addition, the participating Stakers have the option of pooling their holdings in specific networks to form a Staking Pool, which involves staking Coins or Tokens that are stored in a cold wallet.
This is where PolyDEX comes into the picture, a DEX which enables the participating Stakers to bundle their holdings via a user-friendly interface in order to earn more from the funds deposited.
The mechanism that is based on the PolyDEX platform is known as the “General Purpose Liquidity Management Architecture”. All digital assets that are held on PolyDEX can also be swapped using the protocols offered. The Staking Pools are a remarkable feature and tremendous benefit for projects built on PolyDEX, as the platform supports Multi-Chain IFO.
The single asset staking pools provided by PolyDEX only require a small deposit fee and enable users to receive rewards in native tokens. The deposit fee is then sent to the converter, which is used to record the time and then transfer the assets to the staker and development addresses.
The staking pools described above are thus formed with deposit fees and block rates.
Structure of the Liquidity Manager Architecture
The architecture is basically divided into three core areas, which are described in detail below.
Staking Pool Contract
This contract supports additional functionalities like; Multi rewards, Liquidity Manager support and Reward Manager Support.
The new Staking Pools Version 2.0 is an extended and in-house version of the farming contract that was developed by Cryption Network‘s team. This contract provides support for additional features, including:
- Multi-Rewards for Staked Assets
- Reward Manager Support
- Liquidity Manager Support
Liquidity Manager Contract
The Liquidity Manager Contract acts as a direct interface to Re-Staking or, to be more precise, investing the assets stored in the staking pools in appropriate strategy contracts.
Here, the Staking Pool Version 2.0 is linked to the strategy contract and then the calls for deposits and withdrawals for the staking pools are processed via the strategy contract of the liquidity manager.
Strategy Contracts
The Strategy Contract is responsible for the interaction with the underlying protocols, including Aave and in addition to close partnerships with EthaLend and QuickFarms linked to Cryption Network. In general, the strategy contract offers functions such as depositing, paying out and claiming rewards.
The Strategy Contract regulates the liquidity stored in the pool. In addition to liquidity, all other rewards are sent back to the user directly from the strategy contract. Once the Rewards have been transferred, the Liquidity Manager transfers the liquidity back to the Staking Pool, which the user can withdraw their funds from.
Supported Assets, through In-House developed Mechanism
Basically, the following pools are supported by the Staking Pools Version 2.0 on PolyDEX, see here:
- Dai
- USDC
- USDT (Tether)
- wMatic (Wrapped Polygon)
- wETH (Wrapped Ethereum)
- wBTC (Wrapped Bitcoin)
- Users receive the following rewards via Dai, USDC and USDT, see here:
- $CNT and $ETHA
2. Users receive the following rewards via wMatic, see here:
- $CNT, $ETHA and $MATIC
3. Users receive the following rewards via wETH, see here:
- $CNT and $QUICK
4. Users receive the following rewards via wBTC, see here:
- $CNT and $QUICK
In addition, a distinction is made between the different risk levels of the assets as follows:
Low Risk – Staking Pools
- Dai
- USDC
- USDT (Tether)
- Matic (Polygon)
High Risk – Staking Pools
- ETH (Ethereum)
- wBTC (Wrapped Bitcoin)
The high risk staking pools use the underlying QuickSwap farms as a base strategy to generate additional rewards and a higher APR.
However, there is a risk of temporary loss in farms, as the token pairing ETH-wBTC is converted into Liquidity Provider (LP) tokens using a unilateral liquidity provision mechanism.
Due to our advanced use, the token pairings from ETH and wBTC will be used in such a way that an impermanent loss is minimal.
More details about current Staking Pools can be found at: https://app.polydex.org/
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