STATERA EXPLAINED: AN INNOVATION THAT WILL DRIVE MASS ADOPTION OF CRYPTO.
Crypto has reached a stage where there’s a homogeneity in the type of projects we see. Everything either looks the same, or works the same. In this world of similar looking projects all scrambling to be christened as “DeFi projects’, Statera is a breath of fresh air.
In this article, I would strive to give you a better understanding of what Statera is, and how it’s one of the bigger innovations to date.
Here’s what we’d be looking at:
- Statera Explained!(An overview of the project)
- What makes Statera special.
- Statera tokenomics
- Statera's use case.
STATERA EXPLAINED (AN OVERVIEW OF THE PROJECT)
Statera is a smart contract powered Indexed Deflationary Token which synergizes with a portfolio of class leading cryptocurrencies which are commodity driven. If that definition went over your head, then here’s a simpler one: Statera is like a cryptocurrency index. An index is a weighted average of the performance of a group of assets. The assets included in an index are usually picked from a certain area of the market and shows the performance of that area. An example of a popular index is the S&P500(or SPX).
However, Statera doesn’t just go by the definition of an index fund. It also integrates the mechanisms of a liquidity pool into its working.
So what’s a liquidity pool?
A liquidity pool is simply a decentralized “pool” of funds that’s based around a cryptocurrency pair. The pair must however be tradable. In a liquidity pool, those who provide liquidity are rewarded with the fees that come from those who take liquidity.
So how does Statera merge these two concepts together to form a working product?
Firstly, the Statera Index Fund portfolio is comprised of 5 tokens, which include LINK(my favourite), Wrapped Ether(WETH), Wrapped Bitcoin(WBTC), Synthetix and Statera. These tokens are fundamentally strong, which is part of the reason why they were picked.
Each of these tokens maintains a 20% share of the portfolio, and this is managed by a smart contract portfolio manager. This portfolio manager works in a really cool way, and that is by selling any assets whose ratio increases relative to the other assets contained in the fund. This keeps the portfolio balanced, by selling tokens whose prices increase for tokens whose prices decrease.
Statera token is also part of the portfolio, and whenever Statera is bought or sold to balance out the portfolio, it leads to the burning of 1% of the transaction’s value. This makes Statera deflationary, which is a good thing for the portfolio as we’ll see in the tokenomics section. It also makes the portfolio act as a liquidity provider, and as we saw in the definition of liquidity pools, liquidity providers are paid a fee. That also is great for the portfolio.
WHAT MAKES STATERA SO SPECIAL?
You’re probably wondering: “I could create my own index by buying the cryptocurrencies in the index fund and storing it in some wallet”. And while that won’t be the exact definition of an index, you’d still be somewhat right. So what makes Statera special?
Well, if you did that, you’d miss out on the daily interest rates the index gives. Yes, the Statera Index fund gives a yield of 0.10% to 0.50% daily interest, which is completely insane.
They do this through threading through the multiple pools within the project. This leads to an exceptional yearly interest ranging between 38% and a whopping 600%. For comparison, the S&P500 Index has a total of 31% annualized return for the year.
Another thing that makes Statera so special is the presence of a deflationary asset in the fund. Yes, Statera token is deflationary in nature, and that’s a good thing for its overall long term performance. A deflationary asset is one whose buying power increases overtime. An example of one is Bitcoin.
Statera has its own token that is equally part of the Index fund. Let’s take a brief look at its tokenomics
- 101000000 tokens as part of the initial supply(of which 5% has already been burnt)
- Currently costs about $0.059476
- 1% of the transaction cost incurred by sending or receiving the token is burnt, leasing go a gradual decrease in the token supply, which is good
- Early investors in the project have their ASH and BURN tokens converted to Statera.
MY VIEW ON THE USE CASES FOR STATERA
Statera has a lot of use cases to crypto savvy people, but in this section of the article, I want to focus on Statera being useful for people who want to get into crypto, but are scared of losing their money.
Statera is a great and safe way to introduce new comers to the world of crypto. There’s a lesser chance of them losing all their money as opposed to trading, and there are greater rewards for using the pool than for HODLing.
The fund is a great way to get all the qualities of crypto without many of the dangers of trading. Investors are paid passive rewards ranging from a daily interest rate of 0.10% - 0.5%, and the Statera Index fund remains stable by constant rebalancing.
To me, this is the greatest use case as it is the most important: It drives mass adoption.
That’s a brief overview of Statera! I hope you enjoyed the post, and learnt something new.
Thanks for reading.