Announcing the Hydra DEX Automated Liquidity Mining — Starting 1st September
The Hydra DEX liquidity mining system just saw a major upgrade!
We are happy to announce that another milestone has been deployed on production. Those of you who participated in the liquidity mining campaign will be aware of the sheet-based reward calculation and distribution system that we introduced with the start of the campaign.
It was a semi-automatic method meant to bridge the gap until a more advanced system is developed. Today is the day — work has been completed and we are ready to introduce a fully automated liquidity mining system with various improvements.
Snapshots at every Block
One of the many improvements with the new system is that snapshots are now taken at every block, as opposed to every 2000 blocks. This faster pace unlocks a number of new possibilities, such as micro-managing positions and combining liquidity mining with trading strategies (to reduce the impact of impermanent loss, or generally to take profits).
For example, if a liquidity provider anticipates a sudden market movement in the short term, he could exit the position in advance and re-enter after the movement happened. This way, the impact of impermanent loss on the position can be mitigated.
These and more strategies weren’t possible with the previous sheet-based system, as missing out on a single snapshot would translate to 2000 blocks worth of rewards being lost.
Note: Please be careful when combining liquidity mining with trading. Such strategies should only be employed by advanced users, and only after fully understanding the working mechanics of AMMs!
Real-Time Reward Calculation
Since snapshots are taken at every block, the reward calculation is also done in real-time. You can track your rewards accumulating on a per-second basis (similar to how it works with CHANGE staking) via the DEX interface.
This not only allows you to better judge the performance of your position, but also to quickly verify that your position was successfully opened. With the previous sheet-based system, it could take up to one hour for the sheet to pick up your position and display it.
Instant Reward Distribution
Until now the reward distribution was scheduled at a frequency of once a month. This is now changing, as the new system allows liquidity providers to claim their accumulated rewards at any moment.
As a result, you can now compound your position at any frequency you prefer. At the same time you can fully exit your position including the accumulated rewards at any moment. Previously you would had to wait for the next distribution to receive your rewards, even after exiting your position earlier.
Note: LM rewards are paid out in WHYDRA, which can be converted at a 1:1 ratio to HYDRA through the DEX.
How does all of it work?
To participate in the new system, all you have to do is to stake your LP tokens (HYD tokens) on the Hydra DEX staking interface. Below is a 2-step guide:
Step 1: Provide Liquidity
Nothing changed regarding this step. Simply go to the “Pool” tab on the Hydra DEX, and add liquidity to the desired pool (HYDRA/ETH, HYDRA/DAI or HYDRA/WBTC).
Step 2: Stake your LP tokens
Once you have added liquidity to one of the three pools mentioned above, you will receive HYD tokens (LP tokens) in return. These tokens prove your ownership of the liquidity pool, and therefore your position.
Now head to the “Staking” tab on the interface:
You will notice that there are a total of four options to choose from, three of which are about liquidity pools. Simply select the one you added liquidity to earlier.
In the next view, enter the amount of LP tokens you want to stake (or simply click on “MAX” to stake them all). You will see the projected annual reward (in WHYDRA, which is equal in value and can be converted to HYDRA on the DEX at a 1:1 ratio), along with the current estimated APY.
Once you have entered the amount you want to stake, simply proceed by confirming the transaction (the button on the screenshot will turn blue if you have sufficient LP tokens).
That’s it! The entire process only takes a few minutes.
Migration Timeline
The migration of the LM system is planned to take place on the 1st of September. Starting from that date, liquidity providers should stake their LP tokens as explained above, in order to continue receiving rewards. The sheet will be discontinued at that time and all accumulated rewards will be sent out to the liquidity providers shortly thereafter.
Note: We don’t recommend to stake your LP tokens before September 1st, as the sheet won’t recognize your position in the old system during that period. Starting at 00:00 UTC time on September 1st, you can safely stake your tokens without missing out on rewards under the old system.
With these improvements, the Hydra DeFi ecosystem will become much more accessible to the average user as the entry barriers are coming down significantly. As more liquidity pools are launched, and derivative products are deployed by external projects (such as ChangeX), the ecosystem will become more vibrant and diverse.
👉 Join the Hydra Community
HYDRA is a proof-of-stake blockchain optimized for real-world businesses. It tackles some of the most profound and challenging issues with existing blockchain economies and introduces a truly shared economy with fair treatment to all network participants. Some of the more notable features:
🔥 100% Burn of all Transaction Fees
💎 50% Royalty on Gas for Smart Contract Creators → More Info
📌 Fixed Coin Transaction Fees of $0.20 → More Info
📌 Fixed Token Transaction Fees of $0.50 → More Info
💰 20% Minimum APR Staking Income → Staking Calculator
📈 Up to 540 TPS Elastic Capacity
🔏 EVM Compatible Smart Contract Platform
⚙️ Wallet-Level Scalability → More Info
🗳 Unique Decentralized Governance Protocol
