pSTAKE will be launching its liquid staking solution for BNB which is expected to go live in the second week of August 2022. This is another significant stepping stone on our path to creating a comprehensive and robust multi-chain liquid staking ecosystem.
This forum post aims at educating the wider pSTAKE & BNB chain community on the high-level working of the product.
We have always taken a security-first approach while building products. Upon finalization of security audits (expected mid next-week), we are targeting the launch of stkBNB tentatively in the next 2 weeks. More detailed communication would be posted in further Forum posts and on our Twitter.
How does stkBNB (pSTAKE’s liquid-staked representative for BNB) work?
pSTAKE’s BNB liquid staking solution will allow you to stake any non-zero amount of BNB. You will be instantly issued stkBNB which follows an exchange rate model (inspired by the Compound’s cToken model). The value of your stkBNB will keep increasing against BNB as it accrues staking rewards in the background. We have even gone one step further to enable auto-compounding on your BNB staking rewards to allow you to generate the highest yields.
When you perform an unstake transaction on the pSTAKE application, stkBNB deposited by you is burnt. A claim request for an equivalent amount of BNB based on the ongoing exchange rate (c-value) will be created against your wallet. You can then claim the unstaked BNB from the pSTAKE application after 15 days (this allows us to safely undelegate funds from validators). You will stop earning rewards after performing the unstake transaction.
Too impatient to wait? Alternatively, you can swap your stkBNB for BNB directly from the liquidity pools on DEXs such as PancakeSwap.
What will be the rewards for liquid staking BNB?
Staking rewards on BNB come from the transaction fees paid by users of the BNB chain and thus vary according to the network activity. They are received for delegating BNB to BNB Chain validators every epoch (24 hours). Validators take their cut from rewards before sharing it with the stakers, in our case the pSTAKE protocol, as claimable tokens. pSTAKE will delegate to the top performing validators to increase staking rewards. The rewards earned are split into two parts:
- 100%* goes to stkBNB holders in the form of stkBNB value appreciation: This will happen every epoch as staked BNB accrues rewards.
- 0%* goes to the protocol: The protocol fee is managed by a contract and will be targeted towards developmental activities like hackathons, grants, bug bounties, etc. to support the long-term growth of the pSTAKE ecosystem in the future.
*The current distribution will be live for the first 3 months post mainnet launch. The fee distribution will be amended in the future through pSTAKE Governance.
How is the whitelisted set of validators decided?
We want you to earn high staking rewards without compromising on security. The initial set of whitelisted validators will be selected from the Top Validators on BNB Chain based on a scoring mechanism that uses various parameters like APR, slashing instances, and uptime.
Over time, we intend to move this to an on-chain automated validator scoring algorithm.
Will stkBNB be audited separately?
As mentioned at the start of this post, we are working with the industry’s best in blockchain security. The stkBNB contracts have already been audited by PeckShield and we are currently awaiting an audit report from Halborn. The mainnet will go live only after these audits are successfully received.
We are continuously working with Certora to verify the rules in our smart contracts and have finished on the most critical ones. We are integrating with Forta to enable on-chain tracking of the contracts right from the launch. We will also be launching a bug bounty program along with Immunefi to allow white-hat hackers to stress test the product.
We are leaving no stone unturned to ensure that we bring a secure liquid staking product to you.
How will stkBNB be used in BNB Chain’s flourishing DeFi Ecosystem?
Our priority will always be to keep adding more DeFi use-cases for stkBNB to expose stkBNB holders to additional yield on top of their staking rewards. stkBNB holders will be able to participate in DeFi protocols in the coming weeks post mainnet launch. We have received a positive response in our ongoing stkBNB integration talks with some of the largest protocols in the BNB ecosystem including PancakeSwap, Alpaca Finance, Beefy Finance, Wombat Exchange, and more. Details on these will be posted on the forum in the coming days.
stkBNB will drive the next phase of growth for the BNB chain by bringing staked BNB into the BNB DeFi ecosystem while allowing DeFi users to help secure the BNB chain. Win-win.
As we move closer and closer to the launch, we are just as excited as you are. Please let us know your thoughts, suggestions, and anything in between on this post or feel free to drop us a ‘Hi!’ on our Twitter or Telegram.
Watch this space for more.