Polkadot Liquid Staking
What and why is Polkadot Liquid Staking?
Polkadot Staking uses nominated proof-of-stake (NPoS) as its foundation consensus mechanism. By staking DOT on the Polkadot blockchain, participants earn rewards and help to bring security to the network.
Polkadot Liquid Staking from Ankr Staking offers instant liquidity for your staked DOT.
Polkadot Liquid Staking enables you to earn alpha (the return on investment that goes beyond normal increases in the crypto market index).
Ankr Staking can connect you to the best ways to earn more crypto by staking, arbitrage trading, liquidity mining, yield farming, and much more.
For information on DOT Liquid Staking smart contracts, visit DOT development details.
Polkadot Liquid Staking supports several options, including hot and cold wallets. View a complete list at Compatible wallets.
Staked assets are illiquid. Stakers must wait 28 days to unstake DOT. Also, during the unstaking period, unstaking assets are not entitled to additional reward. This creates an opportunity cost in time and capital for the user. Only after unstaking does DOT become redeemable and available for reinvestment.
Using Ankr Staking is the best way to stake DOT as you can access instant liquidity in the form of the aDOTb token. Avoiding locking your DOT up with the Polkadot network is a big advantage — it allows you to use the value of your staked tokens to earn multiple layers of rewards on DeFi platforms and multiply your ROI potential. Yield farming, arbitrage trading, lending, and more will all be possible using the value of your staked assets.
As Liquid Staking solves the capital inefficiency problem of (Nominated) Proof-of-stake networks, it offers a way to earn additional rewards on your staked DOT, enabling new yield farming strategies. The main benefits of DOT Liquid Staking are:
- Liquidity mining opportunities are enabled by providing liquidity for pools in decentralized exchanges. The first main liquidity pools are expected to be aDOTb/ETH.
- Farming rewards for liquidity providers: Liquid Staking presents several yield farming strategies for users to contribute to liquidity pools and gain a share of the trading fees and governance tokens. These new LP tokens can be used to generate yet another layer of earnings.
- Staking rewards on farmed tokens: After using yield farming strategies, users can also reinvest their farmed LP tokens into more staking opportunities. This is a highly repeatable process as layers of rewards from farming and staking will quickly stack up.
- Yield aggregators and vaults can automate yield farming rewards and enable compounding returns with next to no effort from users. This is a great method for maximizing your passive income strategy.
- More trading opportunities are enabled thanks to the elastic supply nature of aDOTb, meaning that you could potentially buy aDOTb at a discount on a Decentralized Exchange and redeem it (unstake it) on Ankr Staking to extract its fair value back in up to 28 days (the Polkadot Liquid Staking unbonding period).
Borrowing and lending
The aDOTb tokens will also allow users to borrow against their aDOTb assets in exchange for assets like DOT that can be restaked or used for additional earning strategies. Or, lend your aDOTb assets in return for interest paid by borrowers.
No technical knowledge required
Receive an easier staking experience with no technical knowledge necessary. Liquid Staking makes staking as easy as a swap: exchange your DOT for the reward earning aDOTb token.
Our Polkadot Liquid Staking will not be using only Ankr validator nodes to stake the DOT from users. Ankr Staking will select several suitable and reliable Polkadot validators, making Polkadot Liquid Staking as decentralized as possible. This means that Ankr will not contribute to giving any party more influence over the Polkadot network as the DOT will be spread over a wide variety of nodes. Ultimately, the end-goal is having Ankr governance decide on the target allocation to different validator nodes.
Contribute to the security of the Polkadot network
Staking with Polkadot Liquid Staking allows you to play an important role in boosting the network’s security as a whole. Ankr’s Polkadot staking system distributes staked tokens intelligently across the Polkadot ecosystem to help the network achieve optimal decentralization. Diversity and decentralization of active validators both ensure the network remains as secure as possible.
Ankr Staking offers instant liquidity for your staked DOT, enabling you to connect your tokens with DeFi and create an opportunity to earn several other layers of rewards.