Why Staking?
One of the best innovations to come out of DeFI today is early incentives. Because tokens are on completely programmatic and permissionless rails, how you use a protocols “equity” can be optimized to best serve the needs of a young protocol.
Where many protocols have failed, is today projects often incentivize in a one size fits all manner, which is inefficient by design:
- Overpaying users who don’t care about speculative tokens.
- Underpaying users who actually value early-stage protocol participation.
By segmenting the rewards from base yield - users have the choice to which source of upside they participate it, which drives efficiencies in enabling higher risk-adjusted returns based on users preferences.