Introduction to SteakBank Finance’s TokenomicsV2
As of 15 September 2021, we have upgraded SteakBank’s tokenomics. TokenomicsV2 introduces a token “aging” concept, where staked SBF are converted into aSBF, and the longer the users hold on to aSBF (aged SBF), the more rewards they will receive. aSBF will also be the governance token used for voting on proposals.
This new tokenomics serve multiple purposes:
- Incentivize long term stakers by providing high yield rewards for longer term participants.
- Reduce predatory farming, where farmers farm at high yields, then dump tokens on the market after getting their share. Predatory farming is being tackled by introducing a linearly decreasing taxation schedule on the SBF rewards
- Provide additional reasons to stake as only aSBF count towards voting of proposals.
This would be an entirely new farming concept, and as such, we will proceed with an explanation of the mechanism and a walkthrough to help users get familiar with it. Let’s start with the simpler concepts and slowly build up from them.
Imagine for the next quarter, SteakBank decides to distribute 300,000,000 SBF tokens as rewards. These tokens will then be spilt across four different contracts to be farmed. In this example, one gets 10%, while three others get 30%.
Single sided SBF Staking (Aging vaults) — aSBF
SBF → Stake → aSBF (Aged SBF)
When your SBF is staked into the AgingVault, you receive aSBF in return for voting rights and a fully composable token that can interact with other protocols, meaning it can be used in numerous ways including as collateral for future lending/borrowing.
Using a single sided SBF staking, users have to start farming on Contract 1, and as time goes on, they would then move on to also farm from Contract 2, Contract 3 and so on until Contract 4.
This would therefore reward long terms holders, and keep them incentivized to stake their SBF, which would reduce supply on the market and indirectly provide a positive outcome for the price action of the token.
Fees collected from minting & redeeming liquid assets will also contribute to the buyback of SBF tokens to be burned. SBF rewards, can also be withdrawn out and restaked into aSBF to compound for more rewards.
However, when the staked SBF (aSBF) are unstaked, they lose the “Aging” factor, and if restaked, they would need to farm from Contract 1 once again, and build back to Contract 4. Staking new SBF will not reset the process.
Farms
LBNB/BNB Farm
Let’s now address farms for the LBNB/BNB pools. Liquidity providers in the LBNB/BNB pools will start farming from all 4 contracts at the same time. The reason we built the system this way is to prioritize liquidity. Providing liquidity is important, and we want to incentivize stakeholders with more rewards upfront as they provide more utility and value to the platform.
Although liquidity providers can farm from 4 contracts from the start, in order to prevent predatory farming precises where farmers farm and dump tokens immediately, we implemented an early withdrawal tax system.
This withdrawal tax system will decrease linearly over time. The early withdrawal system will also help redistribute the rewards from short term holders to long term holders, regardless of whether they are staking tokens on the single sided SBF or on the SBF/BUSD pool.
SBF/BUSD Farm
As for the SBF/BUSD pool, liquidity providers will start farming from the first three contracts at the same time, and after staking for 60 days, they will upgrade and farm all four. Similarly, SBF/BUSD farmers are also subjected to the early withdrawal tax, which will decrease over time. The withdrawal tax is collected so it can then be redistributed in the future.
On both pools, the withdrawal tax will drop linearly as shown in the image below.
In the diagram below we summarized how tokenomicsV2 will work.
Walkthrough and Guide
Let’s now dig into some of the user interfaces on the “aged staking” page. The first thing you see should be the Projected APR, which shows the Annual Percentage Rate (APR) a user can get after staking over a period of time spanning 2 months, in which the user farms all 4 contracts. The current APR, would show the APR the user is actually getting at the moment.
After users start receiving their SBF rewards, they can claim these rewards and stake them into the aging vault. Such a move would create multiple batches of aSBF tokens.
This is where the “more” button comes in. Users will be able to click on “more”, and look at the individual batch going through the aging process. This can be seen as per the diagram below.
If users want to withdraw a limited amount of their SBF, they can choose the batch with the least staking age to withdraw from. Doing so will allow users to retain their aging progress while they continue moving toward higher yields. Keep in mind removing an SBF stake and re-staking it will reset the aging process.
About SteakBank
SteakBank is a Binance Smart Chain (BSC) liquid staking platform. It allows derivative tokens to be issued on the BSC blockchain through the BEP20 standard. These representative tokens can then be used for liquidity farming or as collateral for decentralized lending, enabling users to earn multiple income streams from one single asset.
A simple yet powerful project, SteakBank aims to solve the liquidity issue found in the current DeFi sector where liquidity providing, yield farming, LP mining, and lending platforms make users lock up their tokens and make them unable to use them for other purposes like governance voting or layer1 reward distribution.
Steakbank not only benefits token holders and project ecosystems by optimizing capital efficiency but also allows the communities to earn additional income without the need for further token allocation.
Steakbanks’ native token, SBF, will also be rewarded when users stake their liquid token in SteakBank’s liquidity pool.
