- April 9, 2021
- Posted by: admin
- Category: BitCoin, Blockchain, Cryptocurrency, Investments
Decentralized exchange (DEX) Sushiswap’s SUSHI rewards will finally be released to stakers, users, and liquidity providers over six months after the protocol made changes to the way it would handle its rewards roll-out.
The DEX allows users to lend, swap, and trade assets via a non-custodian, trustless platform wherein all trades are matched via a smart contract. Users can ‘stake’ their tokens on the protocol in various trading pairs to earn ‘yield,’ or a cut of all the trading fees generated from other traders on the DEX.
And while there were some concerns in crypto circles as to how the rewards will be doled out, Sushiswap developers laid out the details on social media site Twitter earlier this week.
The SUSHI rollout
The multi-week plan would see SUSHI rewards getting distributed each Friday for the next six months. “Every Friday for the next six months, users will be able to claim a portion of their rewards from the SushiSwap UI,” said developers in a tweet.
In Q3 2020, the community decided ⅔ of $SUSHI LP rewards would be locked for a 6-month period. At the end of March, this period elapsed.
There remains confusion over how these rewards will be distributed.
A thread explaining how exactly this will work
pic.twitter.com/OkwoaCVabO
— SushiChef (@SushiSwap) April 6, 2021
The developers added they were inspired by protocols like decentralized derivatives exchange Synthetix (SNX), where all rewards are claimed once a week.
Liquidity providers—users who locked up their funds on trading pools on the platform—will additionally be able to determine the amount of SUSHI they are entitled to weekly using this Github link.
Users concerned about the extremely high GAS fees—which average between $45-$75 these days—don’t need to worry about missing out on claiming their SUSHI (someone might earn just $100 worth and spend 50% of that to just claim the reward). All missed rewards will be rolled over to the next week, meaning users could wait for an opportune time.
But to combat against smaller stakers missing out on potential gains, Sushiswap will pay for GAS fees to make up for the difference. “To compensate for gas fees, liquidity providers that earned less than 100 SUSHI through the past six months will be compensated with one SUSHI,” said developers in a tweet.
“This rebate is being paid from the operational treasury,” they added.
Nitty-gritty
Big platforms that aggregated SUSHI LPs to earn rewards will not receive their tokens directly. “Instead, the Merkle distributor will allocate SUSHI to underlying LPs,” the developers said, explaining:
“The LPs that deposited ETH-DAI SLP tokens into Pickle, for instance, can claim SUSHI via the UI. This is being done to allow most SUSHI rewards to be managed through one interface and by the end-user.”
5/ Protocols that earned over 100,000 USD worth of Sushi will not be receiving their tokens directly.
Instead, the merkle distributor will allocate SUSHI to underlying LPs.
LPs that deposited ETH-DAI SLP tokens into Pickle, for instance, can claim SUSHI via the UI.
— SushiChef (@SushiSwap) April 6, 2021
“The community was top of mind when this decision was made,” the developers ended. At press time, the weekly rewards are already available and the next round is expected tomorrow, i.e. April 9.
Meanwhile, the move marked the second major development for SushiSwap in as many weeks. It launched the much-awaited ‘Kashi’ app as part of its BentoBox product suite last month, bringing margin trading capabilities to the platform’s users.
SUSHI trades at $14.43 at press time and has a market cap of over $2 billion. And with over $4.2 billion locked on the platform, it’s one of the largest DEXs by total value locked.
The post How will the SushiSwap (SUSHI) staking rewards be distributed? appeared first on CryptoSlate.
