We recently launched pBTC, the first of our pTokens to be released into the wild (on mainnet). This BTC-pegged token enables Bitcoin’s liquidity to flow into Ethereum’s DeFi ecosystem. In the future, it will do the same for other blockchains, such as EOS.
Check out the full coverage of our launch in Coindesk or read our blog for all the details.
pTokens launch on mainnet!
Time to unleash blockchain liquidity and bring Decentralized Finance to every crypto holder.
Though pBTC is only a few weeks old, you can already find it integrated with a number of different DeFi protocols, including Bancor’s on-chain liquidity protocol. This means you can start staking and earning fees from the pBTC liquidity pool on Bancor now!
In this post we’ll show you to do just that. But first…
Liquidity — what is it, and why does matter?
There is an increasing number of DeFi tools and instruments accessible only through the Ethereum ecosystem. This locks out other cryptocurrency holders, and with them, the liquidity they bring to the market.
A liquid market is a healthy one — it means currencies are cheaper to trade and can easily flow between wallets, DApps and entire ecosystems. Less friction means a better user experience, and more economic potential.
Lending and staking platforms in particular are growing in popularity, and Bitcoin hodlers need ways to participate in this smart-contract economy. pTokens allow them to tap into the Ethereum market via Bancor’s protocol.
A liquidity pool is created when users lend their tokens, known as “staking”, to create an exchange for a specific token. A pool facilitates on-chain, peer-to-contract trades in the token and generates a fee from each trade. Users can collect a share of a pool’s trading fees by adding liquidity and holding its “pool token”. A pool token is an ERC20 token that represents an ownership stake in a liquidity pool.
The greater the liquidity in the pool, the cheaper a token becomes to convert, increasing the volume processed and revenue generated by the liquidity pool. According to the Bancor team, the success of this system depends on users generating high rewards when they stake their tokens in liquidity pools across the network.
In order to stake your pBTC in the pBTC pool on Bancor, all you need to do is add liquidity to the pool through Bancor-enabled DeFi interfaces like Paraswap.
The pBTC liquidity pool on Bancor Network is active and growing. The value of pBTCBNT pool tokens rises as more and more fees from conversions in the pBTC pool.
Learn more about pBTC and how it works:
Here’s how to stake on Bancor Network with pBTC via Paraswap
This guide assumes you have a MetaMask wallet. It’s one of the most trusted and widely used Ethereum wallets — and it’s free. It will connect to all kinds of platforms and allow you to sign the transactions you make on them.
Make sure you have pBTC and some ETH in your wallet (so you can pay for your gas fee). If you’d like to mint some pBTC for yourself, you can use our custom DApp — it’s easy to use and you can link your MetaMask wallet. Or you can swap your ETH or ERC20 tokens for pBTC via Kyber, Eidoo Wallet, Bancor, Uniswap and 1inch.
Go to ParaSwap and select Earn. Here you can search for the pool you’d like to provide liquidity for (by staking your tokens). Search for pBTC and press “supply”.
Enter the amount you’d like to supply. You can supply 25%, 50% or 100% of your token holdings, or enter a custom amount (like we did). You can choose to supply liquidity with just one token (pBTC) or two tokens (pBTC and BNT/USDB), however, supplying liquidity for just one token imbalances the pool and can lead to higher slippage. Please note you must have either BNT or USDB in your wallet balance to effectively do this.
Paraswap will soon split single-token contributions evenly into the two required tokens.
You will have to connect your MetaMask wallet to authorise (sign) the transaction.
Press the little red “unlock” icon next to pBTC. This will prompt you to confirm that you allow Paraswap to withdraw from your balance and process the transaction. Please note this will incur a small transaction (gas) fee. It may take a few minutes for the process to complete, so just be patient (don’t exit).
Press “supply” and wait for the magic to happen (it might take some minutes). You should see a confirmation that you’ve staked pBTC on the Bancor Protocol. Congratulations!
You can check your wallet balance to see the approved transaction.
Once you’ve staked your tokens, you can view the Pool Token liquidity pool and track your earnings on the pBTC at stake via different platforms.
ZumZoom allows you to view various liquidity pools on Bancor, so you can track the Return On Investment (ROI) of the pBTC liquidity pool and see how many users are staking in the pool .
That’s it — just a few taps and you’re already participating in the next generation of finance.