Solutions StaFi’s rToken services offer for users (stakers)
Proof of Stake (PoS) consensus mechanism is what new and old projects are making use of, it is gradually taking over the Proof of Work (PoW). PoS is seen as a better alternative and over 150 projects on the blockchain has adopted the mechanism.
The mechanism simply means that a user stakes an amount of a token then validates block transactions to mine more of the token, the user's mining power is based on the number of tokens staked.
One advantage of PoS is that validators do not have to do much computational works that will require large energy like they do in PoW.
But one big problem is that the tokens/coins staked can not be touched or withdrawn, there is simply no Liquidity for it.
Let's use Ethereum 2.0 as a case study, validators can not touch or withdraw their ETH staked. Their ETH token will remain there for a months, which means it cannot be traded for the mean time.
This is a problem StaFi has provided a solution for through its rToken.
What does rToken mean?
rToken means reward-Token in full.
"rToken is a redeemable token for the staked assets issued by StaFi protocol that can be traded, lent, or borrowed in a variety of venues"
-white paper.
This means when users stake PoS tokens using StaFi protocol, they will get an equal amount of tokens they stake in rToken.
Increase in rToken's exchange rate is directly proportional to the accumulation of the staking rewards for the staked token. Which means for every native token, there is a rToken.
What do users stand to gain from StaFi Protocol's rToken services?
1. Users stake assets and get liquidity. For example: if a user stake ETH which is locked, the user gets rETH with the rToken's services.
2. Users can exchange their rTokens immediately and at their discretion at the rToken/Token (rETH/ETH, rDOT/DOT, rFIS/FIS etc) exchange rates on the markets.
3. Users' staking yield can be optimized as StaFi Staking Contract Pool automatically captures Original Validators with the highest rate of return on the chain for Staking.
4. Users need not bother about technicalities surrounding consensus mechanism, with the introduction of rFIS, FIS stakers can participate in FIS Staking with just one-click.
Conclusion:
Users get a lot gain from StaFi’s rToken services, the liquidity provided will enable them to trade their staked assets while the staked tokens still continues to yield.
You can join the community and learn more about StaFi Protocol:
Website: www.stafi.io
Twitter: twitter.com/@Stafi_Protocol
Telegram Chat: https://t.me/stafi_protocol
Telegram Announcements: https://t.me/stafi_ann
Discord: https://discord.com/invite/jB77etn
Forum：https://commonwealth.im/stafi
