DeFi farmers, rejoice! Steroids.finance is back with another liquidity mining strategy for the Eidoo community. As introduced in October, Steroids is a liquidity mining program for the pNetwork ecosystem, which offers unique Yield Farming strategies and exciting APYs.
Given the success of the initial program – which rewards liquidity providers to the pBTC/WBTC pool on Uniswap – the team has announced this week a new strategy for farming PNT.
Now through the Steroids program, users are able to become Liquidity Providers in Uniswap’s ETH/PNT pool and earn rewards in unlocked PNT. And since the Steroids DApp is integrated directly into the Eidoo app, users can easily provide liquidity and earn rewards – in just two clicks!
Read on for step-by-step directions.
Add ETH and earn in Eidoo
Every week a reward of 15,000 PNT will be distributed and divided between liquidity providers. To become a liquidity provider – that is, to participate in the ETH/PNT liquidity pool via the Eidoo app – proceed with the following steps.
From your personal wallet page, select “Stake PNT/ETH & Earn.”
On the next page, select “Use ETH to Stake PNT/ETH.”
On the transfer page, enter the amount of ETH you want to stake and confirm.
Uniswap liquidity pools are always composed of two pairs. When joining the PNT/ETH Uniswap pools by depositing ETH via Steroids, half of the amount is automatically converted into PNT (with PNT tokens bought at market price through the same Uniswap pool). As a result, liquidity is provided to the pool with a balanced 50/50 proportion of PNT and ETH.
Please note that when interacting with Uniswap liquidity pools you may be subject to “price impact” (also known as slippage). This is the difference between the market price of a token and the estimated price applied by the pool. When joining the program with ETH, your transaction may be subject to slippage.
As a general rule: the larger the amount involved, the greater the price impact; and the larger the pool, the smaller the price impact.
A best practice before joining a Uniswap pool is to assess the price impact of your transaction. When joining the PNT/ETH strategy on steroids.finance (see below) the price impact of your transaction is displayed in the slippage section. But for Eidoo users, before joining the pool, we suggest you verify the price impact by simulating an ETH/PNT swap equal to half of the ETH directly involved through Uniswap (in the “to” field paste the token address: 0x89ab32156e46f46d02ade3fecbe5fc4243b9aaed to display PNT).
Alternatively, Add Liquidity on the Steroids DApp
One way to reduce slippage is to join the Uniswap pool by providing liquidity in a balanced proportion of 50% PNT and 50% ETH, then join the Steroids program with the relevant UNI-V2 strategy on steroids.finance.
For directions on joining Steroids with UNI-V2, check out this guide from the pNetwork team.
Please note, that when joining the PNT/ETH Uniswap pool you may be subject to “impermanent loss.” This is the price ratio between the moment the liquidity was supplied and now. In this case, the pool is composed of 50% ETH and 50% PNT. If ETH goes up in value, the pool must rely on arbitrages that continuously ensure that the price reflects the market price to keep the same amount of both tokens in the pool. This leads to a situation where the profit given by the token has appreciated in value and is subtracted from the liquidity provider. At this point, if the liquidity provider decides to withdraw liquidity, the temporary loss becomes permanent.
For more information on Impermanent Loss, please refer to this link.
Manage your rewards in Eidoo
Once your ETH is staked, you will see the following items in the main menu:
- Your unstaked PNT, ETH funds
- Your staked allocation
- Estimated returns (updated at each block)
- Earned so far
- Total pool size (displayed in both ETH and PNT)
Note: PNT rewards are distributed to each block
Collect your rewards
In the main menu, tap on the “Stake PNT/ETH & Earn” banner.
Tap on “Claim rewards.”
On the next screen, you will see a precompiled address: don’t change it!
Enter “0” as the ETH amount to authorize the smart contract and tap “Proceed.”
Confirm transaction.
Unstake and collect your rewards
To exit the strategy, unstake and collect rewards, proceed with the following steps.
In the main menu, tap on the “Stake PNT/ETH & Earn” banner.
Tap on “Unstake & Claim.”
Tap on “Step #1.”
On the next screen, you will see a precompiled address: don’t change it!
Enter “0” as the ETH amount to authorize the smart contract and tap “Proceed.”
Tap on “Step #2.”
On the next screen, you will see a precompiled address: again, don’t change it!
Enter “0” as the ETH amount to authorize the smart contract and tap “Proceed.”
Note: When unstaking is performed, both ETH and PNT will be withdrawn (a partial unstaking of funds is not possible). In this case there will be no Price Impact (slippage).
For more information on the Steroids liquidity mining program, check out our previous announcement. And if you require additional assistance, you can always find the Eidoo team in the official Eidoo Telegram channel.
Happy farming!