Elevate your digital asset rewards, effortlessly.
Today, the Proof-of-Stake (PoS) consensus has become the conventional standard for how new blockchains are cryptographically designed. Prior to PoS, we had Proof-of-Work (PoW) consensus, which Bitcoin utilises till this day. PoS became the norm after a whitepaper was first introduced by Scott Nadal and Sunny King, with an intention to address Bitcoin’s mining high energy consumption. Alongside, staking was introduced, which democratised on-chain participation for the wider crypto users and proliferated the web3 expansion.
Despite the accessibility, many PoS blockchain networks introduced restrictive mechanisms such as lock-ups and unbonding periods, which not only isolated many users but also introduced liquidity risks. The ill-fated Terra ($LUNC) blockchain had a 21-day unbonding period. Then came liquid staking initiative, which removed unbonding and lessened illiquidity, but introduced another form of constraint by introducing staking IOUs derivatives that tend to diverge from the underlying asset prices.
To address the inherent limitations with Staking and Liquid Staking, we created a solution which caters to the wider crypto communities by removing barriers to efficient yield generation, and caters specifically to crypto retail users not whales.
The permissionless and trustless aspect of Proof-of-Stake (PoS) blockchain is one of the most powerful innovations we have seen in the modern day era. The PoS blockchain network operates on a consensus mechanism. This mechanism sets the rules on how network validators should verify and sign the next block of transactions. In return for carrying out this exercise, the validators earn rewards.
In order for validators to ‘validate’ they need to cast a vote. Casting of votes is controlled by the number of assets the validator ‘controls’. These assets are provided by you and I, the users who own these assets. In return for providing these assets (staking) we get a share of the rewards the validator receives. In summary, we stake our tokens, help secure the blockchain network, and get paid in return. This is a far more valuable proposition than the early days, when we used to just buy and hodl. We can now buy and stake.
Of course there is no such thing as an ideal world. Staking has challenges, one of which is the unbonding period. Should an investor wish to unstake and sell their tokens, it can take more than 10–20 days before the tokens are returned to the user’s wallet, becoming sellable. Case in point, Terra ($LUNC) had a 21 day unbonding period, and Polkadot currently requires a 28 days unbonding period. In the case of ETH, the staking unbonding period is even more uncertain as all staked ETH are locked in the beacon chain, and can only be retrieved post the PoW & PoS merge.
20+ days of not being able to move assets has an adverse impact to portfolio management. The inability to move one’s asset swiftly if the price of the token is capitulating, or worse the protocol is compromised is a limiting factor for users when it comes to staking.
Furthermore, CEXs add additional lock-in periods, running anywhere from 30 days to 365 days. Again, users can only just sit and watch while the price of their assets collapse, unable to trade out of their positions.
To address this problem, Lido Finance launched a liquid staking initiative. It empowered users to stake ETH (and other cryptocurrencies) without having to be locked-in and improved liquidity. This was achieved by introducing stETH derivatives IOU contract that was easily tradable as the underlying asset (ETH) for 1:1 in various centralized and decentralized exchanges. This next generation of staking seemed to be an ideal solution. That was until the backdrop of Terra network collapse and macro downturn. At this point, the 1:1 peg deviated and users with stETH IOU suddenly found their derivatives contracts to be worth less than ETH.
The liquid staking innovation did not directly address the problem, but re-packaged the risk and made it a “tradable” asset. Yet Lido’s thoughtful efforts has advanced staking tenfold by improving liquidity and helped expand the security of ETH2.0 (Lido accounts for 1/3rd of all staked ETH).
At present, our sentiment is that the current state of blockchain rewards or liquidity pools are fundamentally broken. Both unbonding period and lock-ups immobilize investors, especially retail crypto investors, which ultimately heightens the inherent market risk of holding an asset.
Over the course of 2022, we have been busy developing and battle-testing a solution we feel is the next step in the evolution of staking. No lock-ins, tradeable in/out of any positions and no derivative pegs. We like to call it XGo Superfluid.
Simply put, we empower our customers to generate yields directly from their personal XGo wallet without taking any commensurate risk.
From today, you can simply move your crypto assets to our platform, earn APY rewards daily, and continue to trade that asset simultaneously. We do not lock-in your assets, we manage bonding cycles, and you can deposit and withdraw whenever you choose to.
We are able to provide XGo Superfluid Rewards service through active on-chain and off-chain rewards participation.
We are firm in our declaration to deliver yield rewards for aggregate wallet value up to $10,000 per customer. XGo Superfluid Rewards is designed by retail crypto enthusiasts for retail investors who enjoy trading and earning yield on their digital assets, simultaneously. We are bringing blockchain rewards to the masses, not just for whales.
For July 2022, we are running Coin-of-The-Month campaign with a special focus on Polkadot.
Sign up to XGo.com to earn Superfluid Rewards on Polkadot.