Guide to HSK Staking: Maximizing Your Returns

Since the launch of HSK Staking, we have received valuable feedback from our users. Based on these suggestions, we are committed to continuously improving the staking product’s rewards and user experience.

This article will explain the revenue sources, exchange rate mechanisms, and the relationship between HSK and stHSK in the staking system. If you have any further questions, feel free to comment — we value your input and will keep improving.

Overview of HashKey Chain’s Staking Economic Model

The HashKey Chain staking system utilizes an innovative share model, where staking rewards are distributed transparently and efficiently through stHSK tokens. In this article, we will explain how this economic model works and how you can maximize your staking returns.

stHSK: A Token That Automatically Accumulates Rewards

When you stake HSK, the system mints and distributes an equivalent amount of stHSK tokens based on the current exchange rate. These stHSK tokens have three key features:

• Automatic Value Growth: The value of stHSK increases as staking rewards accumulate.
• Liquidity & Transferability: As an ERC-20 token, stHSK can be freely transferred and used in DeFi protocols.
• No Manual Claiming Needed: Your rewards are automatically reflected in the increasing value of stHSK, eliminating the need for additional operations.

Revenue Sources & Distribution Mechanism

Revenue Sources

The staking rewards in the HashKey Chain staking system primarily come from block rewards. The system sets an Annual Reward Budget (ARB), which is evenly distributed across each block over time.

Exchange Rate Mechanism

The system calculates the exchange rate between HSK and stHSK using the following formula:

1 stHSK = Total Staked HSK Pool Total Supply

• When new block rewards are added to the staking pool, the total staked HSK increases, while the total stHSK supply remains unchanged.
• As a result, the value of each stHSK increases, reflecting the accumulated rewards.

Base Annual Percentage Rate (APR) Calculation

The base APR is dynamically calculated using this formula:

Base APR = (Annual Reward BudgetTotal Staked HSK) × 10,000 (basis points)

For example, if the Annual Reward Budget is 1,000,000 HSK and the total staked HSK is 10,000,000 HSK, then:

(1,000,00010,000,000) × 10,000 = 1,000 basis points = 10%

If you choose flexible staking (no lock-up period), your expected annual return is approximately 10%.

Staking Options & Reward Enhancements

1. Fixed-Term Staking

Lock-up period options: 30 days, 90 days, 180 days, 365 days

APR boost: Base APR + Additional incentives

Lock-up period options:

• 30-day lock-up: +0% (No additional incentive)
• 90-day lock-up: +0.8%
• 180-day lock-up: +2.0%
• 365-day lock-up: +4.0%

For example, if the base APR is 8%, then a 365-day lock-up provides an additional 4%, bringing the total APR to 12%.

2. Maximum APR Limits

To ensure the sustainability of the system, different lock-up periods have corresponding APR caps:

• 30-day lock-up: Up to 1.2%
• 90-day lock-up: Up to 3.5%
• 180-day lock-up: Up to 6.5%
• 365-day lock-up: Up to 12.0%

If the calculated APR exceeds the cap, the system automatically adjusts it to stay within the limit.

3. Early Unlocking Mechanism

• Fixed-term staking allows for early withdrawal; all rewards and bonuses will be fortified, and a 0.1% penalty fee will be applied.
• The penalty fee is redistributed into the reward pool, benefiting long-term stakes.

How to Maximize Your HSK Staking Returns

Strategy 1: Long-Term Locking for Higher APR

• A 365-day lock-up provides an extra 4% boost, significantly increasing your overall returns.

Strategy 2: Staggered Locking (“Yield Ladder”)

• Divide your HSK into different lock-up periods to create a staggered reward structure.
• This strategy balances liquidity and high returns by ensuring regular maturity periods.

Strategy 3: Use stHSK in DeFi for Dual Rewards

• While staked, stHSK can be used in DeFi protocols, allowing you to earn additional yield.
• This enables a dual-income strategy:

1. Earn staking rewards from HashKey Chain.
2. Earn DeFi protocol rewards from using stHSK.

Real-Time Monitoring of Your Staking Performance

Use the following functions to track your staking details:

• getCurrentExchangeRate() – Check the current stHSK to HSK exchange rate.
• getDetailedStakingStats() – View detailed staking statistics and current APR.
• getHSKStakingAPR() – Retrieve base APR and min/max APR for each lock-up period.

Final Thoughts

The HashKey Chain staking model provides a flexible and competitive staking solution for HSK holders through stHSK tokens and tiered reward mechanisms. Whether you are a long-term holder seeking high yields or an active trader needing liquidity, this system allows you to customize a staking strategy that fits your goals.

Start staking today and let your HSK generate stable, long-term returns!