Liquid Staking With High APY

Stader Labs is bringing liquid staking to BNB Chain, and in anticipation, the protocol announced giveaways and more details about BNBx. 

"We are very excited to launch on the BNB Chain, there are billions of dollars in capital in the ecosystem that can be unlocked through liquid staking,” Gautam Midha, Head of Strategy and Expansion at Stader Labs, told BSC News. “Additionally, there are several evolved DeFi protocols already operating on the chain, we are looking forward to the innovative strategies users build on top of liquid staking to maximize yield."

The protocol promises APY of up to 25% on $BNB, and to keep things interesting, Stader has announced a $500 giveaway for five winners. 

The current staking yield is 4-6%, but the protocol claims to be able to increase this by 15-25% through optimal validator selection and auto-compounding. Along with its liquid staking on BNB, Stader will launch its liquid token, $BNBx. The liquid staking Beta is currently live on BNB Chain.

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BNBx Reward Structure

As described in a Medium article on July 20, when users stake BNB, they will mint BNBx at the current exchange rate, which can be used to earn more yields on other DeFi protocols. Stader then optimizes the BNB deposited by users across various network validators. These validators process transactions, which generate rewards, which are redirected by Stader back into the staking pool, enhancing the value of BNBx

“BNBx is a reward-bearing liquid token, i.e., the value of 1 BNBx token vs. BNB increases over time as staking rewards accumulate,” Stader Labs stated in the Medium article.

The BNBx<>BNB exchange rate will increase using this formula:

New BNBx<>BNB Exchange Rate = Current BNBx<>BNB Exchange Rate + (Rewards Added/Total BNBx in circulation).

Learn more about how xBNB generates yield in this Twitter thread from Stader Labs.

You can use the BNBx token to borrow stablecoins that you can stake to earn more rewards. Additionally, upon launch $BNBx can be used as collateral for borrowing any other BEP-20 token from a lending/borrowing protocol. Borrowed tokens can be traded for more BNB tokens, allowing more $BNBx to be minted.

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Securing User Funds

In an interview with BNB Chain, Stader Labs described its approach to securing users' funds:

1. The protocol uses multi-sig admins and “best-in-class” cloud security features in their solution.
2. Two prominent firms in this space, Halborn and Peckshield, have audited Stader Labs’ code.
3. Stader Labs engages with several security firms specializing in threat detection and monitoring to ensure ongoing security.
4. Stader Labs has stringent criteria for validator selection to ensure the safety of users’ funds. You can learn more about the selection criteria here.

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What Is Stader Labs:

Stader Labs was founded in April 2021 by Amitej Gajjala, Sidhartha Doddipalli, and Dheeraj Borra. It specializes in cryptocurrency stake management. Stader plans to use decentralized financial protocols and applications to manage stakes efficiently on public blockchain networks. 

Stader Labs raised $12.5 million this January in a strategic private sale, raising their valuation to $450 million. Stader Labs is backed by Pantera Capital, Coinbase Ventures, Jump Capital, Accomplice, Accel, Huobi Ventures, Hypersphere, and True Ventures, among others.

Where to find Stader Labs:

Website | Twitter | Medium | Telegram | Discord 

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