Introduction
Welcome folks, the future is here now - PolyCub has been launched and is all the buzz in the cryptoverse [see, e.g. BeInCry.pto Staff. DeFi 2.0 Meets Yield Optimization with PolyCub. (Accessed April 5, 2022); and Cointelegraph. PolyCub: The next generation of DeFi-yield optimizers has arrived. (Accessed April 5, 2022)]. Beyond the topic herein discussed, PolyCub has tons of new mechanisms for investments available and for a comprehensive guide to everything PolyCub, your attention is directed to: POLYCUB ULTIMATE GUIDE - What Is Polycub And How Do I Use It?].
To the matter at hand, the PolyCub platform affords investors the opportunity to stake their PolyCub Tokens receiving xPolyCub in return. But for the magic of DeFi 2.0, this staking goes far beyond anything seen in DeFi 1.0. So why is the staking of PolyCub Tokens as xPolyCub such a damn good investment?
Staking PolyCub as xPolyCub - The Process
The process of staking PolyCub Tokens on the Platform is a very simple process. If you don't own PolyCub as of yet, you may acquire the same quite easily through SushiSwap [see: Nagoda, K. It's Easy to Buy PolyCub Tokens at SushiSwap : Step-by-Step Instructions with Photos. (Accessed April 5, 2022].
Now that you have some PolyCub Tokens open the PolyCub Platform homepage by clicking here.
First things first, you must connect your wallet (Metamask is highly recommended for it's ease of use and ability to access many differing blockchains). Click the orange button at the top right side of your screen labeled 'Connect'. On the pop-up page, choose the appropriate wallet where your PolyCub Tokens are stored:
Now that you have your wallet connected, locate and click 'xPOLYCUB' which is found in the menu on the left side of your screen:
Once you have clicked the 'xPOLYCUB' label, you are ready to stake your PolyCub Tokens:
For purposes of this tutorial, a minimal 3.04 PolyCub to be staked has been made available. The sum of POLYCUB you have avaiable to stake appears in the area encircled in green in the following photo. When ready to proceed, click the '+' button circled in blue in the following photo:
In the pop-up screen that appears having clicked '+', for this tutorial 'max' was clicked meaning all of the available POLYCUB tokens will be staked. See the green encircled area in the following photo. Be aware, other staking options exist (25%, 50%, and 75%). You may also enter any other amount manually in the gray 'staking' area. If you are satisfied with the amount to be staked, click the orange button labeled 'Confirm' in the following photo:
A pop-up window on the right side of your screen will appear for you to confirm the transaction and pay the gas fee. Scroll down and click 'confirm' in the pop-up. Once confirmed (~ 30 seconds), click the area encircled in blue labeled 'Get POLYCUB' in the preceding photo to execute the smart contract.
Congratulations, you have successfully staked your POLYCUB into xPOLYCUB!
Staking PolyCub as xPolyCub - The Mechanics Making the Magic Work
"PolyCub (POLYCUB) is the native token for the PolyCub yield optimizing platform. Users can earn POLYCUB by participating in any of the Kingdom vaults or by staking it into xPOLYCUB to earn the 50% fee penalty generated by other farmers who harvest their yield before the X block locking period" [PolyCub. Long-Term Deflationary Tokenomics - xPOLYCUB. (Accessed April 5, 2022)]. xPOLYCUB "changes the dynamics of token distribution via Yield Optimization Harvesting Fees" [Id].
xPOLYCUB is an earnings machine that is a thing of beauty. When an investor stakes assets in PolyCub Kingdoms, that investor becomes entitled to earn from two separate income streams. First, the staking investors earn cross-platform, autocompounding yield from the Kingdom's LP Provider. (Take for example the DAI-USDT-USDC Kingdom. The LP for that Kingdom is obtained through Curve and it is Curve that pays the base APY for the Kingdom which is then autocompounded by the Kingdom vault).
In addition, secondly, the Kingdom vault also pays POLYCUB rewards in addition to the base APY. The mechanism is so designed that when these POLYCUB rewards are received by the investor, said rewards are locked for 90 days. The investor may, at their option, elect to receive the POLYCUB rewards received at any time prior to the expiration of the 90 day period, but if the investor so elects, the investor suffers a 50% penalty on the POLYCUB rewards resulting from their early claim.
This 50% penalty is not retained by the Platform, but rather, is paid over to and shared, pro rata, with all the xPOLYCUB stakers.
...staking xPolyCub gives one the leverage to relax for future yield or harvest. Since xPolycub is for long term, xPolycub creates room for those who have long term goals but doesn't have the adequate startup capital to begin the project. One can fix a 5 year margin before using the xPolycub rewards. This will amount to a very huge some of money within the said period of time.
[
The Value of Diamond Paws
In the case of PolyCub, farming bots and other yield farmers are welcomed to take advantage of this Platform. Well, why? "Kingdoms TVL brings in Kingdoms Management Fees which are paid to PolyCUB's Protocol-Controlled Value Treasury. This means that the more capital that flows into PolyCUB Kingdoms, the greater the long-term Risk-Free Value of PolyCUB will become" [PolyCub, supra].
How Does PolyCub Strengthen and Boost PolyCub Token Distribution Back into the Hands of the Diamond Paws?
Or, in other words, just how does PolyCub reward the 'hodlers' of its tokens when viewed in terms of long-term tokenomics?
And the answer is (drumroll) - xPOLYCUB staking. So just how does that work?
The xPOLYCUB staking mechanisms independently redirect through redistribution POLYCUB from the hands of the short-term holding farmers back into coffers of the existing Diamond Paws. This redistribution occurs as a result of the dynamic created by giving POLYCUB farmers the choice of leaving their earnings locked for the 90 day base period, or conversely, paying the 50% penalty for early unlocking.
"With xPOLYCUB, we've built this massive center to the ecosystem which sucks in value and distributes it to the hands of diamond paws" [
As noted in the PolyCub Docs, the redistribution above described drive three effective mechanics to the heart of PolyCub tokenomics. These mechanics are:
- Long-term Yield Farmers hodl their harvests longer which spreads out the claiming of new POLYCUB tokens. Creating more consistent, long-term inflows of POLYCUB to the open market
- Short-term Yield Farmers pay a 50% penalty on their harvests, which means they have less POLYCUB to sell on the open market
- Long-Term 💎🐾 stake their POLYCUB into xPOLYCUB and earn a high yield from the autocompounding POLYCUB Single-Stake Vault + POLYCUB tokens are redistributed from short-term farmers to 💎🐾 via the 50% harvesting penalties which are autonomously paid to anyone staking POLYCUB as xPOLYCUB
[PolyCub, supra].
Understanding the Ratio and Growth of Earnings in Perpetuity
To understand your earnings from staking POLYCUB as xPOLYCUB, the POLYCUB TO xPOLYCUB ratio controls. ["To understand how this works, you can divide 'Total Staked' on this page (user stakes, rewards, penalties) against how much Polycub is in the xPolycub contract (0x905e21f6c4cb1ad789ced61cd0734590a4542346) totalSupply (how much xPolycub has been created from user staking); PolyCub. POLYCUB STAKING. (Accessed April 5, 2022)].
At present the PC/xPC ratio stands at 19.8118 meaning if you redeemed 1 xPOLYCUB now, you would receive 19.8118 POLYCUB in return. By design, this ratio never decreases and will only increase in value (translated to greater earnings the longer the stake is maintained).
Also, by design, earnings growth as designated by the PC/xPC ratio will exhibit growth in perpetuity. The xPOLYCUB Staking Mechanism "...creates an interesting game theory for all users: many farmers will likely claim their harvests early for various reasons. I.e. they need liquidity fast for an opportunity, believe something is going to change quickly in the market, etc. With this knowledge, other users/farmers will buy and stake POLYCUB into xPOLYCUB to leverage up and earn this 50% fee in addition to the other mechanism for earning as an xPOLYCUB hodler...." [PolyCub. POLYCUB - Token Supply & Emission. (Accessed April 5, 2022)].
As such the mechanism is designed using the continuous need for Kingdom farmers to claim early harvests for whatever reason adding the 50% penalty to the staked xPOLYCUB earnings. Now, couple this with the growing earnings incentive created to encourage xPOLYCUB staking, and there will be a continuous demand for xPOLYCUB. This designed circle of early harvests and continued xPOLYCUB demand creates the earnings growth in perpetituity.
[NOTE: Although is is beyond the scope of this article it must be noted. Both POLYCUB and xPOLYCUB are low fixed supply tokens. As such, as they are continuously demanded for use in the market, their supply becomes scarce causing an increase in price pressure. And as we all know, when price increases so to does earnings].
Some Final Thoughts
Once started, what was originally contemplated as a simple (and short) endeavor, took on a life of its own. And its not so much for the reasons that staking POLYCUB into xPOLYCUB or alternatively that the xPOLYCUB mechanics are so complicated to require long, drawn out, boring, explanations. No, the true reason is that the design approach of this project is so novel and interesting that it was just easy to continue researching and writing.
Well, now that you know that acquisition of the xPOLYCUB token by staking POLYCUB is easy, that it is a high yielding investment strategy, and that its earnings will grow forever, what are you waiting for? Go grab some POLYCUB and get those tokens staked - begin your journey to future financial independence. Indeed, staking POLYCUB as xPOLYCUB is, in fact, such a damn good idea!
Good luck one and all.