Bancor 3 features deep dive ๐
Letโs talk about auto-compounding and why users are so excited about it โค๏ธ
๐
Letโs talk about auto-compounding and why users are so excited about it โค๏ธ
๐
1/ Currently, as a liquidity provider, you need to manually re-add collected $BNT rewards to a pool to increase your staked liquidity.
The gas cost for re-staking rewards reduces your overall returns.
The gas cost for re-staking rewards reduces your overall returns.
2/ The downsides of this are two-fold:
First, users leave $BNT on the sidelines that they could otherwise use to compound gains.
Second, the Bancor protocol cannot make use of that idle $BNT to increase liquidity on the network.
First, users leave $BNT on the sidelines that they could otherwise use to compound gains.
Second, the Bancor protocol cannot make use of that idle $BNT to increase liquidity on the network.
3/ Auto-compounding in Bancor 3 offers the following benefits:
Users enjoy gasless auto-compounding of swap fees & rewards, collected in a stake & forget manner
Plus, the networkโs liquidity gets improved by having all these tokens continuously re-circulated into the network๐
Users enjoy gasless auto-compounding of swap fees & rewards, collected in a stake & forget manner
Plus, the networkโs liquidity gets improved by having all these tokens continuously re-circulated into the network๐
4/ It's not only $BNT rewards that get auto-compounded.
Bancor 3 allows 3rd-party protocols to drop token rewards on their pools that are auto-compounding.
So you earn three types of auto-compounding yield: swap fees, $BNT rewards & 3rd-party token rewards with zero IL.
Bancor 3 allows 3rd-party protocols to drop token rewards on their pools that are auto-compounding.
So you earn three types of auto-compounding yield: swap fees, $BNT rewards & 3rd-party token rewards with zero IL.
5/ Auto-compounding makes Bancor the only major DEX that offers this type of feature to its liquidity providers.
Watch @MBRichardson87 explain all the benefits of auto-compounding in 2 minutes ๐
Full video: youtube.com
Watch @MBRichardson87 explain all the benefits of auto-compounding in 2 minutes ๐
Full video: youtube.com
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