MetalSwap Knowledge — NFT Staking Dynamic Strategy
The NFT staking feature was recently released on the Op Chain, marking a turning point for the MetalSwap project. Now it is time to take advantage of it.
Originally written on MetalSwap’s Official Blog — MetalSwap Release: UniV3 NFT Staking
The NFT staking feature was recently released on the Optimism blockchain, marking a turning point for the MetalSwap project.
Now it is time for the community to take advantage of this new opportunity, both to actively support the dApp and to earn incredible rewards, such as 500 OP and 5000 XMT tokens.
For those who are not familiar with it yet, this feature allows users who provide liquidity in Uniswap V3 in the XMT/USDC pair to take their NFT that represents the deposited liquidity and stake it within the MetalSwap dApp.
In this article we will explain a strategy for the liquidity range that will provide to the user the max benefit in terms of rewards.
How to deposit liquidity on UniSwap V3?
In the official article about the NFT staking feature we already provide a step-by-step guide for depositing the liquidity directly from the dApp and we refer you to this guide if you do not know how to provide liquidity for this new function.
In this article, we will propose a 50/50 strategy on the XMT/USDC pair, which means you will need to own the same dollar value for both tokens in the pair. Let’s pretend we have $500 worth of XMT and $500 worth of USDC for a total value of $1000.
How to manage the liquidity pair on Uniswap and in which range to place it?
In today’s article, we present a liquidity providing strategy that we have named “dynamic” because it involves setting a fairly narrow range.
On Uniswap V3, in fact, you can decide the price range within which to concentrate the liquidity. The tighter the range, the greater the concentration of the liquidity and thus the rewards that will be gained.
However, the tighter the range, the greater the risk that the price will move out of that range and that the position will no longer be able to earn anything until it will set around the new XMT price.
The strategy presented today aims to be quite aggressive and use fairly narrow price ranges, which will definitely involve more active management, but obviously at the pros of more rewards compared with more wide and less active management.
For those who prefer wide ranges and passive strategy, we will soon release a “Soft” strategy after this article.
In this case, we select a symmetrical range around the current price of XMT, which builds at -15% and +15% from the current price of 0.01475 $.
This strategy will therefore be active as long as the price of XMT remains within the range of 0.01253$ to a maximum of 0.01696$. Once the range is selected, we simply deposit the 500 dollars of XMT, equivalent to 33898 XMT, and the $500 of USDC, and we create the position.
Take advantage of this opportunity
This is a great opportunity, both to earn excellent rewards and to actively help the growth of the project, as deeper liquidity pairs bring a general benefit to the project and especially to the token.
Again, the greater the concentration of liquidity, the greater the rewards within the MetalSwap dApp.
Every week, 10% of the rewards present within the rewards pool will be distributed. This means that in the first week, 50 OP (which is 10% of 500) and 500 XMT (which is 10% of 5000) will be distributed.
During the second week, 10% of the remaining 450 OP and 4500 XMT will be distributed, and thus the rewards will gradually decrease.
To make the most of this opportunity and earn the maximum rewards, it is important to participate in staking as soon as possible.
-The DeFi Foundation
✎ What is MetalSwap?
MetalSwap is a decentralized platform that allows Hedging Contract on financial markets with the aim of providing coverage to those who work with Digital Asset and an investment opportunity for those who contribute to increase the shared liquidity of the project. Allowing the protection for an increasing number of operators.
With Hedging Contract we enable hedge swap transactions through the use of Smart Contracts, AMM style.
It’s great to Hedge the Risk of Price volatility with MetalSwap dApp !
