APY, Compounding and Staking Mechanisms

It is official, Bank Of Cronos has launched! Our Initial Public NFT Offering has closed after having bootstrapped our liquidity pools and kick-started the protocol’s treasury. Congratulations to those who have received their Airdrop token allocation! We look forward to working with those who choose to participate in our upcoming DAO integrations within our discord server.

The Bank of Cronos DAO tokens are backed by a treasury of assets implemented so that 1 token cannot be minted without 1 USDC (or any other treasury reserve asset) transferred to the treasury in exchange. We have bootstrapped the treasury with USDC tokens from our IPNO and have set the staking reward rate to 0.05% per 8 hours divided to those who are staking their BOC tokens. We decided to be very conservative with the reward rate until we have released our Bonds (USDC, BOC/USDC LP) so as to avoid dilution for our token holders. Ultimately the market and the DAO should decide on the reward rate for stakers. The market will determine the average bond discounts and then the DAO can decide the rate at which token holders can receive higher staking rewards without diluting the token value.

Users are now able to stake BOC tokens for sBOC tokens on our App or cronoscan (cronoscan staking helper contract link) and to earn the reward rate from the Treasury once every 8 hours. sBOC can always be exchanged 1:1 for BOC, but it rebases to reflect rewards earned from the Treasury. This means holders can compound; for example, every day of our first week we rebased ~0.05% per 8hrs. If you held 100 sBOC, your first rebase of the week was 0.05% of total supply of BOC /total sBOC staked. Each rebase will generate users a different APY return for staking, depending on what percent of BOC tokens are staked. These returns will be variable to start and will become more stable with the introduction of our USDC and BOC/USDC LP bonds. Token holders can provide liquidity to the BOC/USDC Cronaswap Liquidity Pool ( https://app.cronaswap.org/liquidity) to earn LP fees.

The BOC DAO continues to progress towards its goals of increasing the treasury and its protocol owned liquidity from our upcoming bond release. Stay tuned for more updates on all BOC DAO integrations in discord such as to allow token (and NFT) holders to participate in the DAO workstreams. We will update the community on how Guilds will be set up in the near future and we look forward to the DAO working collectively to achieve all its goals.

Works Cited

“Compounding, and the Mechanics of Staking”. Olympus DAO Medium, 20 Jan. 2022,
https://olympusdao.medium.com/compounding-and-the-mechanics-of-staking-a579129f1012

Authored By: NewageSage

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