As a seasoned crypto investor with a keen eye for potential, I find Velar’s collaboration with StackingDAO to be a game-changer for the Stacks ecosystem. Having navigated through various bull and bear markets, I can attest to the importance of liquidity and capital efficiency in the ever-evolving world of DeFi.
Velar collaborates with StackingDAO by adding greater liquidity to the market to empower “Stackers” – individuals who stake STX cryptocurrency to bolster the Stacks Layer-2 blockchain. This collaboration materializes via the introduction of a fresh stableswap trading pair for STX/stSTX tokens, accessible immediately on its decentralized exchange platform.
In simpler terms, for Stacks – a well-known decentralized network enabling smart contracts on Bitcoin – stacking (which we can refer to as ‘staking’ in this context) involves locking up STX tokens into smart contracts to help validators process transactions on the L2 layer, thereby enhancing its security. Unlike other staking processes where token holders typically receive the native token as rewards, with Stacking, users receive Bitcoin instead.
The objective behind introducing the new STX/stSTX pair on Velar is to encourage more STX token holders to stake their tokens, thereby enhancing the network’s robustness. Historically, Stackers had to wait a certain period before they could unlock their staked STX tokens, thus restricting their access to their capital during times of need. However, with this new trading pair on Velar, users can easily exchange stSTX tokens, which are given out in proportion to the STX tokens staked by each user, allowing them to swiftly enter and exit a staking position, thereby increasing the efficiency of their capital.
It’s logical for Velar, a protocol famous for its Bitcoin-focused perpetual contracts and decentralized exchange platforms, to foster the expansion of Stacks in this manner. This action can speed up its overarching goal of enhancing the practicality within the Bitcoin ecosystem for BTC owners. By drawing on Bitcoin’s security and utilizing Stacks for increased scalability, Velar effectively combines the best aspects of both platforms.
Using its Decentralized Exchange (DEX) and other services, Velar enables Bitcoin (BTC) owners to utilize their holdings as collateral in various DeFi (Decentralized Finance) applications on Stacks. In this way, it’s significantly contributing to the transformation of Bitcoin, as the leading cryptocurrency shifts from primarily being a store of value to becoming an asset that offers the same flexibility as other popular cryptos like Ethereum (ETH) or Solana (SOL).
In simpler terms, Velar explains that the trading pair for STX/stSTX will address a rising liquidity issue within the Stacks ecosystem. This is accomplished in innovative ways, primarily by employing a “stableswap curve” mechanism which facilitates swaps with less price discrepancy (slippage) and lower fees, making it more appealing for those who hold substantial amounts of STX and stSTX.
Furthermore, Velar is aggressively motivating STX and stSTX owners to contribute liquidity to its swap platforms with attractive incentives. These rewards include a slice of the 5,000 VELAR daily prize pool for liquidity providers, as well as an assurance of a 50% boost in StackingDAO points for those who stack STX using that specific protocol.
In various projects, points are given to users in recognition of their involvement and interaction. These points serve as a measure for determining qualification for airdrops and additional token rewards later on. Therefore, many participants are eager to accumulate as many points as possible, and contributing liquidity to the STX/stSTX pool is an effective method to earn even more points.
Given these substantial incentives, Velar is quite optimistic about drawing in sufficient liquidity to cater to even the most significant institutional investors who are seeking an effective, cost-efficient method for exchanging vast quantities of STX tokens and their staked alternatives.
It’s also good to see the increased unity within the Stacks ecosystem. StackingDAO, along with Velar, is one of the biggest protocols running on Stacks. It’s a liquid staking protocol for Stackers that allows them to unlock liquidity while providing added protections against impermanent loss to boost investor’s returns from yield farming activities.
StackDAO’s proficiency is clearly demonstrated in the “upgradable adjustable midpoint” of the stable swap pool, a characteristic engineered to safeguard liquidity providers (LPs) and minimize potential losses from temporary price fluctuations (impermanent loss).
As a proud member of Velar’s team, I can say that the launch we’ve worked tirelessly on is a significant milestone for us. Working alongside the gifted minds at StackingDAO has been an enriching journey, and together, we’re pushing the boundaries of what can be achieved in Bitcoin DeFi.
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2024-11-26 12:32