FARMS

The first LP incentives pool on StakBank will be based on STAK-ETH UniswapV2 LPs, with a total duration of 60 days.

It’s better to use a tighter duration since this is our first run on LP incentives. In the future, we could open other pools with lower/higher allocation, new LP pairs such as STAK-USDC, new DEXes such as 1inch or Sushiswap, or even UniswapV3 LPs. These will become increasingly relevant as user adoption increases on their platform (and we possibly migrate over our LP locks to V3 - this is really dependent on UniCrypt though).

This pool won’t have longevity rewards.

The functionality of the pool is very simple: the LP pool will have a set allocation of 6,000,000 STAK (total_pool_reward) distributed proportionally during the chosen period. This averages 100,000 STAK per day, or approximately $6,000 with STAK at $0,06.

Inside the smart contract, rewards are calculated every second, and user distribution follows a simple weighted average corresponding to the share of the pool every user has at the time.

Example:

• User 1: 10 LPs

• User 2: 15 LPs

• User 3: 25 LPs

If they all withdraw their daily rewards at the same datetime, their rewards would be:

• User 1: 20,000 STAK = 1200 USD

• User 2: 30,000 STAK = 1800 USD

• User 3: 50,000 STAK = 3000 USD

Resulting APR formula is:

user-deposit-amount = user-lp-in-pool * lp-price

user-pool-share = user-lp-in-pool/total-pool-supply

user-year-earnings = (total-base-pool-reward * stak-price * user-pool-share * 100)

APR(%) = user-year-earnings / user-deposit-amount

APY = (1 + APR/129600)360 – 1

The APY formula is not very precise because in order to compound, a user needs to convert half of earnings back to ETH, create new LPs and then deposit them back into the pool.

APY (generic) = (1 + r/n )n – 1

r is the stated annual interest rate and n is the number of compounding periods each year

With daily compounds, there are roughly 360 compounds in total over a year.

r is the periodic rate a user is earning over a day so it’s APR/360.

APY = (1 + APR/129600)360 – 1

All rates in DeFi are temporary and are not guaranteed, since they vary with token prices.