In this article, I’ll explore the unique staking model offered by Bogged Finance, which rewards users with a portion of platform revenue.
Many DeFi users are by now probably well-acquainted with the typical staking model: users lock away their tokens and get something in return, usually a cut of trading fees or minted tokens.
Many staking models come with inherent disadvantages, for example minting tokens to reward stakers can create huge sell pressure, and makes the underlying asset inflationary, which can severely impact its value if buying dries up.
How does DeFi staking work?
“Staking” comes in many different forms, but for this article I’ll be referring to staking as it’s commonly used in Web3 projects.
Staking systems inherently strengthen a decentralised ecosystem - they can reduce the appeal of swing trading associated governance tokens. An important feature of a governance token is stability, which makes it more appealing to users who want to use it for its functionality.
LP (Liquidity Provider) staking, also bolsters decentralised ecosystems, by encouraging users to provide vital trading liquidity for tokens. Larger liquidity pools reduce the price impact of trading, which again stabilises the token.
In return for helping to support the ecosystem, stakers are rewarded, but this is where the problems I touched on above come into play
At Bogged Finance, a different approach to rewarding stakers has been adopted, which may be of interest to some readers of this post.
How does Bogged Finance staking work?
The Bogged Finance DeFi ecosystem uses BOG as its governance token. This token is, among other things, used to pay for the suite of tools offered by the DApp, including DeFi stop-losses, limit orders and cross-chain bridging. For convenience, users can choose to pay in native token (BNB, CRO, AVAX, FTM etc), but these payments are always used to purchase the equivalent amount of BOG.
This creates a constant demand for the governance token, as well as a source of revenue to the platform.
However, instead of immediately selling the token to generate profit, the Bogged Finance team distributes this revenue to stakers. Stakers receive a portion of these fees depending on what percentage of the pool they’re staking.
What is the benefit of this type of staking model?
This staking model means the BOG token is much more sustainable in the long-term than other governance tokens, thanks to the consistent demand and true deflationary qualities of its implementation.
To further reward stakers, site functionality and pro features are unlocked by staking certain amounts of BOG. This, along with the generous APR’s offered by the rewards, gives further incentive to users to help stabilise the ecosystem.
Another major advantage of revenue-sourced staking rewards is their consistency and resilience- the rewards aren’t pegged to trading volume or the buy/sell pressure of a token, so stakers will find that they consistently pay decent APR’s, even in bear markets and downturns.
How does the platform make profit if their revenue goes to stakers?
Bogged Finance is a large collection of various DeFi tools, including charts.bogged.finance, which attracts upwards of 4 million monthly visitors. Advertising income from this charting platform, along with other revenue streams such as non-BOG fees and partnerships pays for server uptime, staff costs and other operational costs. The team has also made it clear during interviews that they are not interested in selling off BOG to fund the site.
How do I get started with staking on Bogged Finance?
Staking is currently available for BNB Chain, Fantom, Cronos and Avalanche, with more chains in the pipeline.
First, ensure you’re holding a balance of BOG. You can purchase BOG on BogSwap.
Then visit https://app.bogged.finance/staking and select the chain you’re trading on in the top right hand corner.
You can then immediately add the BOG to our solo staking pool and start earning a share of platform revenue. For a larger cut, you can also LP stake, by combining BOG with either BNB or USDC and staking the resulting LP tokens.
If you need help with staking then don’t hesitate to get in touch with one of our helpful staff on Telegram
To stay tuned to our upcoming news and releases, make sure to follow us here, on Twitter, and on our Telegram Announcement Channel. We’ve also started posting announcements to Publish0x. If you have any questions, our supportive and knowledgeable staff are happy to answer them in our Telegram Group or Discord. Remember, our staff will never DM you first, nor will they ask for private keys..