I've been following and participating in the Banano community for almost a year and a half now, and something that I did fairly early on was providing liquidity to the Banano pools as a way of providing liquidity for the project, as well as get some sweet rewards myself! What these Liquidity Pools (LPs) are, are a pair of tokens, in this case $ETH-$BAN, that are used as collateral for one another on different blockchains. Basically, the price of Banano on the Polygon blockchain, is paired against the price of Ethereum on that blockchain. In 99% of cases, there are rewards provided to do this, as you're using your own tokens as collateral, there are usually incentives for doing so, these rewards are provided by the Banano Dev team in this case.
There are a couple ways to provide liquidity, but first you'll want to know that you can't stake Banano itself - you first need to wrap it, or get Banano on another network (such as Polygon, Binance, etc.). I'm going to show you how to do it with Polygon (Matic) here, but the process translates well across all the chains!
If you're looking into providing liquidity for Banano, you probably already have some $BAN and a wallet, but if not, you can get one of the best crypto wallets out there by downloading the Kalium app, it will look something like this - and remember to write down, and save your passphrase in more than one safe location!
Once you have the wallet and some $BAN, you'll also need some Ethereum. I'll show you how to bridge some native $ETH to $wETH here:
First you'll need to go to a bridge. One that I've used a couple times over the last two years is, https://bridge.umbria.network/bridge/ethereum-polygon/matic.
You'll need to connect your wallet (I'm using MetaMask here), and select "Ethereum Mainnet" in the "Send From ->", and "Polygon PoS Chain" in the "-> Receive On". You then put in how much you want to swap from $ETH to $wETH (make sure you leave enough for gas fees - about $0.30, or 0.00025 $ETH).
You can see the transaction here:
Now that we have some wrapped Ethereum on the Polygon chain, we also need Banano on the Polygon chain. In order to do this, we need two things - the Banano from our Kalium wallet we talked about earlier, as well as some of the native Polygon token - Matic.
For this again I will be using the MetaMask wallet, as well as the Kalium wallet to wrap the $BAN.
To start:
Go to https://wrap.banano.cc/setup. You need to enter the Banano address from your Kalium (Banano) wallet and verify you own the wallet by sending "0.01 BAN" to the address that it prompts you to.
I already have some Matic, but if you need some for the gas fees, (around $0.05) there are some faucets, such as https://matic.supply/ where you can get small amounts to potentially cover some transactions.
Once we've done that, we can go back to the main screen here, https://wrap.banano.cc/ and deposit some Banano to wrap. Make sure you're on the Polygon Network, next to the connect option on the top right of the screen. Hit the "Deposit Ban" button at the top of the page, and send however much $BAN you want to wrap (make sure you send a small test transaction first) so you know nothing will go wrong!
You will now see the $BAN you deposited to get wrapped, as well as any balance you have of wrapped Banano:
Now we want to wrap it! Enter in however many $BAN you want to wrap, hit "Wrap" and "Sign" the MetaMask transaction that pops up - accept the gas fee and finish the transaction by hitting "Confirm", and voilà!
Now that we have both wrapped $ETH, and $BAN - we can move on to the next phase of the process, providing liquidity. Here we go to the "Stake & Farms" tab at, https://wrap.banano.cc/farms.
Hit the "Add Liquidity" button, and it will bring you to the Sushi DEX (Decentralized Exchange). Make sure you connect your wallet, and you're on the Polygon network, and then add both the wBAN and wETH token pairs, then type in how much you want to add to the pool - typing in "12,000" BAN, will auto-fill the respective amount in wETH so you don't have to do the calculation yourself.
Now hit "Add Liquidity", "Confirm Supply" and "Confirm" the MetaMask transaction to pay for the gas.
The transaction got stuck so I sped it up which is why the gas was a bit more expensive for this one, but on to the next! Once you've added your liquidity on Sushi, you need to go back to https://wrap.banano.cc/farms, and hit the "Supply" button, next to where we added the liquidity.
It might take a second for the liquidity to load, but once it does, hit the "Max" button to make sure you don't leave anything behind, then hit "Supply" to add your wETH-wBAN LP Tokens to the pool "Confirm" the MetaMask transaction that pops up to pay the gas fees, and start earning that as advertised APR% in BAN, in real time!
You can get a breakdown of how much you've provided in liquidity, the total pool value, APR, and your current rewards all on the farms page by clicking the "Details" button.
If you'd like to reap your rewards, you can hit the "Harvest" button on the "Stake & Farms" tab. "Confirm" the MetaMask transaction that pops up to pay the gas fees, and you're done! It's literally that easy! Remember though, that it takes about ~$0.01 or 0.005 Matic to "Harvest" so if you don't have a lot of Matic to spare for gas fees, make sure not to claim too often!
Now you can come back every fifteen minutes, hours, days or let it sit for months and get some passive income while also supporting the Banano project! The team regularly posts updates on the Discord regarding the rewards every month, help with problems providing liquidity and more. I've lost trust in a lot of crypto projects over the last 8 months or so, but I can absolutely say that Banano has been one of the best for me!
I hope you all found this breakdown somewhat helpful, and that you're all having a wonderful holidays!
Much love, AAQ.
In Short:
1. Banano Wallet (Kalium, BananoVault, etc.) and some $BAN.
2. Ethereum Wallet (MetaMask, etc.) and some $ETH (or $wETH on Polygon/Binance/Arbitrum/etc. network)
3. Swap $ETH to $wETH if needed.
4. Verify/setup with https://wrap.banano.cc
5. Provide liquidity of $wBAN-$wETH on https://app.sushi.com/swap
6. Supply the liquidity pool tokens you received from providing liquidity on Sushi to the "Supply" tab under the "Stake & Farm" section.
7. Harvest rewards whenever you'd like - remember you have to pay gas every time
8. Enjoy!
