What is sAVAX?

Before delving into what sAVAX is all about, let’s understand the concept of liquid staking. Avalanche is a Proof-of-Stake network that pays users a preset amount for staking their assets to keep the system secure. However, there are some complications with this since PoS and DeFi were not designed to work together in the first place. Staking AVAX on validator nodes - Avalanche Platform Chain (P-Chain) - bonds the user’s tokens to the nodes, locking them up for a fixed duration.

> Liquid staking offers users the chance to unlock their staked assets and use them on decentralized platforms - Avalanche Contract Chain (C-Chain). As a result, users can earn passive income on their staking rewards. Furthermore, users can also use their staked assets on DeFi apps to control risk or earn more income, depending on what they want.

So, sAVAX - (BENQI's Liquid Staked AVAX) - is an interest-bearing version of the AVAX token. Users will receive the sAVAX token once they stake their AVAX tokens. As a result, users will receive incentives for safeguarding Avalanche and for their role in the DeFi space. Therefore, Benqi gives users who provide liquidity to its protocol the sAVAX token as a receipt. Also, Benqi offers a 7% APR for users who stake on its platform. So, users can take their staked AVAX and earn from other platforms.

The price of sAVAX increases relative to the amount of total AVAX staked (including accrued AVAX rewards) in the pool.

sAVAX Price = total AVAX staked / total sAVAX minted * AVAX price

Avalanche Refresher

*Avalanche C-Chain: The Avalanche Contract Chain is the default smart contract blockchain on Avalanche and enables the creation of any Ethereum-compatible smart contracts. This blockchain is for applications that require total ordering and is the main blockchain where Decentralized Finance dApps are built on.

*Avalanche P-Chain: The Avalanche Platform Chain is the metadata blockchain on Avalanche and coordinates validators, keeping track of active subnets and enables the creation of new subnets. This blockchain is where Avalanche Validating and Staking is done.

References

• BENQI Liquid Staking Release

Stake & Unstake on staking.benqi….

Swap on Dex’s to get sAvax

Technical Details

• Staked AVAX: 0x2b2C81e08f1Af8835a78Bb2A90AE924ACE0eA4bE
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Depositing sAvax : QiTokens (qiAVAX, qiUSDC, qiQI, etc.)

Supply/Borrow/Earnings