After months of work, we are proud to announce that the NOTE staking module is live! Stake your NOTE here.
NOTE staking represents a huge step forward for Notional and its community of NOTE token holders. Notional has been very successful in its mission to bring fixed rates to DeFi, and now NOTE holders have the ability to stake their NOTE and share in the protocol’s success. Find more details on NOTE staking mechanics in our previous blog post.
Estimating sNOTE returns
The NOTE staking module offers NOTE holders the opportunity to earn attractive rewards that grow with the protocol while taking minimal impermanent loss risk. The NOTE Staking module will kick off with a six month reward program that will deliver strong returns even in extreme impermanent loss scenarios.
The rewards that will be directed to sNOTE holders over the next six months are currently valued at $1,925,000. Here is where those rewards come from:
- Revenue re-investments (COMP): $1,450,000
- Additional incentives (NOTE): $350,000
- Trading fees: $125,000
If all the funds in the 50/50 Balancer pool (~$3,000,000) move to the sNOTE pool, the sNOTE reward APY will be 128% APY. This yield delivers extremely strong returns to staking NOTE if the NOTE price stays constant or moves lower.
The strength of this yield means that sNOTE returns will still be positive in extreme price scenarios despite the IL. For example, if the NOTE/ETH price goes up by a factor of 10x over the next six months, sNOTE IL will be 38.1%, but the total return to sNOTE will still be positive at +1.5% APY.
Note that returns can vary due to changes in the market value of sNOTE rewards or the total value of NOTE staked in the pool. If you want to estimate sNOTE returns yourself, you can find detailed return calculation methodology in our docs.
How to stake
- If you are participating in the 50/50 NOTE/WETH pool on Balancer, first claim your rewards and withdraw your pool investment.
2. If you've already unstaked from the 50/50 pool or if you are starting fresh with your NOTE, head over to the Notional staking page.
We recommend supplying WETH and NOTE in the 80/20 proportion of the pool, but the backend will automatically buy/sell assets on your behalf to LP in the pool.
3. Enter the total number of NOTE you’d like to stake. Click ‘optimize’ to automatically supply the correct amount of WETH.
4. If you haven’t yet enabled NOTE access for your wallet, toggle the switch directly below the optimize button.
5. If you have extra ETH in your wallet you’d like to supply for staking, you can adjust the ETH amount in the input box or simply hit the “max” button.
6. If you only have NOTE tokens in your wallet (+ ETH for the transaction fee), you can leave the ETH field blank. Some of your NOTE will be sold in order to supply WETH as 20% of the total amount. You can see the price impact of your trade next to the NOTE price.
*Note, you can choose to supply ETH directly and it will be wrapped automatically as WETH
7. Click the “Confirm & Submit Trade” button to finalize your transaction and stake your NOTE!
The NOTE staking module is a major step forward for the Notional protocol and for NOTE holders. sNOTE provides an opportunity for NOTE holders to benefit from the protocol’s success and the insurance that sNOTE holders provide makes Notional an even safer and more attractive option for lenders and liquidity providers. This leads to a self-reinforcing cycle that will help to increase the value of NOTE and strengthen the protocol.
The Notional Team
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