Stader's Real Yield Incentive

This sounds too good to be true, mate

Who is paying that 700’000$?

When I see such numbers of profit, I ask myself where this funds are come from?

Ja w krypto jestem początkująca .

Witam jestem ciekawa , i napewno jak wszyscy … A więc co wy robicie . Czym się zajmujecie … i po co … Jak już chcecie pomuc sobie i nam . To wyjasnijcie powoli krok po kroku co mamy robić i czy dzięki wam zarobimy coś

I agree with @sweetcheeks that locking token supply is no longer a good idea and may be outdated. Most newer “real yield” protocols (e.g. GNS/GMX) no longer lock users’ funds. They attract stakers to hold on to the tokens by providing reasonable real yield to stakers. Do note that “locking” is not free as stakers will expect a significantly higher yield from reduced liquidity. And locking of tokens will further decrease the already low liquidity of stader token.

@WaXTeP The $700k is subsidised by protocols emitting farming tokens. E.g. the bribes you paid to Curve are usually lesser than the dollar amount of CRV actual emission to your pool. The reason is CRV holders are diluted by the emission that’s not fully paid by the bribes but there’s enough demand to sustain the price of CRV. If there’s not enough demand then CRV price will tank which happened to some smaller protocols.

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Hey @emanuel @WaXTeP @sweetcheeks, here is Stader explanation:

The tech for the SD staking is already conceived.

It is a model identical to our X tokens (BNBx, MaticX, HbarX…), meaning:

  1. People will stake their $SD tokens and receive $xSD in return.

  2. Revenue sharing fees are accrued into the $xSD token, so the exchange rate of xSD:SD goes up in time.

  3. People effectively cash out the rewards when unstaking the xSD back into the SD token.

This model has the advantage of being tax-efficient and user-friendly to users because it works exactly the same as the rest of liquid staked tokens we are creating.

Happy to hear your thoughts. In any case, this coud be one of the first topics subject to public voting as soon as this first iteration of staking (and therefore governance) goes live.

Thanks a lot for the great discussion guys. @sweetcheeks @WaXTeP brilliant suggestions. Wanted to share our thought process behind the SD staking and roadmap. Love to hear your thoughts.

Key thoughts behind SD <> xSD model are:

  1. One of the key utilities of SD tokens is for validators to stake SD to be part of the staking set. This will be implemented once we reach a good TVL on Eth, BNB, Polygon etc. Asking them to pair SD with USDC to provide liquidity is stretching it much.
  2. Also, some of the private sale funds will be averse to LP’ing on a 3rd party DEX

Merits of 80/20 SD <> USDC staking:
We definitely see the merits of this as this improves liquidity for SD. Would definitely want to implement this along with SD <> xSD model.

Regarding staking rewards in SD vs. stables vs. x-tokens, I will check with legal counsel and come back to the forum.

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Very interesting conversation, enriching from all sides.

As Amit says, it owuld make sense to proceed with xSD, and on a second phase consider a second mechanism (while still leaving xSD there) that can cater to long-term investors who are willing to increase the liquidity depth of SD with an 80:20.

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Agree with guys about locking. If we want to implement stimuls, i’d suggest using staking multiplier. Longer you stake - more multipier you get.

Staking LP tokens also a great idea.

Get multiple tokens - i’d say no. Because there will be much dust there. If staking contracts will be on Mainnet, it’s a lot of gas for claiming rewards. USDC / ETH rewards are better.

80%+ of revenue to stakers would be ok.

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Sushi currently has an issue where they are cutting staker rewards because current profits cannot handle staff costs.

Stader holders/stakers will generally be long-term holders. A high APR will be very bullish for price in the short-term but bad long term.

The current crypto winter means revenues will be small but will likely increase later. Expansion now is much easier than later when crypto summer begins. I did the math for how much Stader is currently making and it isn’t a lot. ETH staking if successful will 2-3x revenues at a minimum.

I’d suggest 20% of Stader revenues go to stakers. That would be a start. Monthly statements can be posted by Stader showing revenues versus costs and this 20% can go up to 50% once the crypto winter ends. Right now expansion not dividends is #1. Stader needs as much power as possible going into ETH staking.

I do support the suggestion that staking should pay more over time. Maybe a 3 month ramp up before you receive full rewards? Locking has both advantages and disadvantages. I’d support a short lock period to withdraw to prevent flash deposits/withdrawals from bots.

PS: Full disclosure, my company may work with Stader, I have a dolphin size amount of Maticx, and if a certain something appears for Maticx stakers that’ll be partially cause of me.

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Hi Chris, your proposal is serene and insighful.

I really like the example of Sushi because it should serve (as many other DAO-governed projects) as a cautionary tale to avoid mistakes when decentralizing (especially regarding pace of decentralization and topics left for governance, such as human-resources-related).

Hello aditya, I’m wondering if the % of fees being taken as staking rewards for sd token will be in the chain tokens[bnb,near,eth etc] or stables or in sd itself

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Wouldn’t it be better to split it let’s say 50/50
Stables and sd token,an opportunity to dump your rewards and an opportunity to accumulate SD

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thanks for your insights @Midoriyacrypto. We are pubishing the SD staking mechanism in a few days, and the Revenue Sharing proposal several days afterwards. Both documents should give you the full picture of what we have devised.

This initial design, however, it is subject to change based on DAO governance, of course.

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Nice to read all comments! And also that Stader is asking the community for idea’s :slight_smile:

Personally I think Stader should have a model like Umami Finance, where people can earn real yield by staking sd tokens (or auto compound and earn more sd’s).

Dividend in ETH
Since the chance is high that ETH will be a commodity in the future, plus the fact that ETH has a big mcap, I would propose to pay the dividends in ETH (or WETH). Paying yield in ETH is also a big marketing opportunity with ETHstaking around the corner. (Assuming ETH-stakers would love opportunities to earn some extra ETH)

Also this would prevent SD dumping → even if the shared profit is used to market buy SD, it will create pump&dump of the token.

Paying dividends in a basket of coins can be unatractive for small stakers; if you have micro amounts, the transaction fees of cashing out will overweight the rewards. Another company (nash.io) changed paying out dividends a year ago: from “basket” concept to paying out in USDC to support smaller amounts.

However, i wouldn’t use USDC since it’s a bit unclear how that is regulatory-wise. (if you pay dividends in dollars, the dividend-paying token should be a security-token?)

SD-tokens for farming (marketing: boost of ETH-yield?)
I would use part of the sd tokens that are still in the treasury (for farming purposes) to attract ETH stakers. Like Luna in the beginning: stake ETH and earn next to eth-yield SD tokens.

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The swap from SD to ETH could also cause some issues which is usually why people pay in their own token.

Anyway with the crypto winter ending I’d strongly suggest leaving most of the yield with Stader for the next 4-6 months so they can attack ETH staking with as much power as possible. Now is not the time to take dividends.

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I really like this quote. Businesses will rarely give dividends if the most efficient use of capital is to reinvest it in the company for a faster growth pace.

I think something like ~25% of revenue sharing is a modest, realistic, yet bullish figute, but without going bonkers and jeopardizing expansion.

cheers

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