Steemit Crypto Academy | Season 2: Week7-- Liquidity Mining (Tron- Sun.io)

in SteemitCryptoAcademy4 months ago (edited)

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DeFi is a strong & enduring force in the crypto segment. It does solve the major problem interface of traditional finance. "Banking the unbanked" is now a reality with DeFi.

The intermediaries are completely replaced by Smart-contract in DeFi. The utilitarian value of crypto in DeFi combining with stable coin caused people to rally en masse around DeFi in 2020. The expansion of financial and business use-case together with ever-rising total locked value in DeFi is a testimony to that.

The DEX once plagued with fragmented liquidity issues for a long time solved with the introduction of the AMM mechanism.

DeFi has been catering to the use-cases of Lending, Borrowing, Supplying assets to the Liquidity pool & earning APY, exchange, etc.

Today we will cover Liquidity Pool, Liquidity Mining in detail. We will keep it central to the Tron DeFi ecosystem-- Sun.io

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Liquidity Pool

In an order-book model(CEX), there is a list of bid and ask values, and the difference between the bid and ask is known as the spread. In a highly liquid market, this spread is narrow, competitive, and offers the best value of exchange to a trader. In contrast in an illiquid market, the spread goes higher, and hence exchange value could be worst for a trader.

Generally, the popular CEXs do not suffer from liquidity issues in comparison to DEX.

In contrast, the major problem with DEX is that the liquidity is fragmented as there is no such centralized pool, the liquidity remains in the decentralized wallet of the individual traders.

AMM mechanism solves this problem interface of DEX and introduces a constant product market-making mechanism(xy=k), as a result Liquidity Pool(LP) is created in which x and y represent the two sides of the pool.

The product of x and y at any given time is a constant.

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So the equilibrium condition is xy=k.

If xy is not equal to k, then the price of the asset will adjust itself to bring it to the equilibrium condition-- xy=k. That adjustment of the asset is known as the exchange rate. This is the underlying principle of AMM-based DEX.

Justswap relies on this principle to create a liquidity pool for each pair where the users are free to contribute to the pool and based on their contribution ratio w.r.t the total pool size, they earn their share.

When you contribute to a pool you have to contribute equivalent value to both sides (x & y).

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AMM model exchange creates an opportunity for the investors to pool their tokens and earn exchange fees from each trade. Ideally, in a decentralized exchange, the liquidity providers earn 100% transaction fees. At any given time, the fund is in absolute control of the owner.

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Liquidity Mining

In Justswap, every time an exchange happens, the trader pays 0.3% fee, and then the fee is distributed proportionally among the LP providers.

So when you supply coins(both sides) to a Liquidity Pool, you are entitled to a Liquidity provider fee, in proportion to your liquidity contribution.

But it does not stop here. Sun.io is a dedicated DeFi segment in Tron that docks different DeFi projects of Tron to offer you a variety of mining options. You can further galvanize your position as a Liquidity Provider. For example, if you are a liquidity provider in Justswap you can further stake your LP tokens to earn mining rewards(SUN-TRX LP offers the highest APY, 37.04%). Similarly, if you have supplied assets in JustLend, then you can stake it to start JustLend supply mining.

So if you are a liquidity provider in Justswap, you are issued LP tokens, then you can stake your LP tokens to start mining and you are entitled to century mining rewards. Please pay attention to the different cycles and phases of century mining.

  • As an LP provider, you earn your share from exchange fees
  • By staking LP tokens, you start mining in Sun.io. You can mine 5 different tokens(TRX, JST, BTT, SUN, WIN).

Note- Recently BTCST token is added to Tron Century Mining, so instead of 5 different tokens, you will now earn 6 tokens(TRX, SUN, BTT, JST, WIN and BTCST) as mining rewards.

Your contribution(staking LP token) weighted with "duration & percentage of the total LP" will determine your mining rewards.

Depending on a particular phase in Century mining, the mining reward of 5 tokens(supply per day) is defined. Then 70% of the mining supply goes to Justswap Liquidity Mining and the remaining 30% goes to JustLend Supply mining.

The third phase of TRON Century Mining is currently running: May 3rd, 2021 21:00 — Jun 7th, 2021 20:59 (SGT)

Mining rewards(Supply per day)- Phase 3

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Source

Speed of Mining

Different LP mining has different schedules of speed. And that could vary from one phase/cycle to another.

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Source

Unlocking of mining rewards

  • The mining rewards are unlocked & distributed on a weekly basis over a total span of 24 weeks. In other words, you will keep getting your rewards(5 different tokens- TRX, SUN, BTT, JST, WIN) every week until the 24th week.

  • 33% of the SUN rewards can be unlocked at any time. The remaining of the SUN along with the remaining 4 tokens can be unlocked as per the regular schedule, i.e. can be unlocked on a weekly basis over a span of 24 weeks.

It must be noted that you are getting additional rewards through century mining by utilizing/staking your LP tokens. So it's an additional bonus on top of your Liquidity Provider fee that you directly generate from the exchange fees collected/distributed in Justswap.

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How does it work?

Customer Journey Map (Timeline).jpg

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How do I obtain LP tokens in Justswap

To obtain an LP token, you have to provide liquidity to the both sides of the pool. First, go to Sun.io and check what are the different LP mining pools available and accordingly choose a suitable pair in Justswap to provide liquidity to obtain LP token.

  • Go to https://justswap.io/
  • Select Pool, Then click on Add Liquidity
  • Select the pair of the tokens(e.g. USDT/TRX) in Justswap. Please check the different LP mining pools available at Sun.io and accordingly select a relevant pair.
  • Enter the amount.
  • Click on Supply. Then confirm supply.
  • Then a pop-up will appear, asks you to sign the transaction. Click on Accept.
  • Liquidity added now.
  • Now check your wallet(or explore Tronscan) to locate your LP token.

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How do I stake LP tokens to start mining (5 different tokens)

At the moment, there are 9 different LP mining pool on Sun.io. Select any one of your choice, but make sure you have the LP tokens to stake.

  • Go to Sun.io
  • Connect your wallet.
  • Select a specific LP mining pool, e.g. I will select USDT-TRX LP.
  • Enter the amount. Click on Stake.
  • Sign the transaction(Click on Accept)

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Now you can manage your staking here. In other words, you can add an additional stake or you can also withdraw part or full. Please pay attention to claim. There are two parts-- one is Available to claim(SUN) and the other part consists of total undistributed rewards. 33% SUN can be withdrawn at any time. But the undistributed rewards can be unlocked as per the fixed schedule(i.e. weekly basis over a total span of 24 weeks).

Please note that you can unstake LP tokens at any time. But the unlocking of the mining rewards will follow the defined schedule(i.e. weekly up to a total of 24 weeks).

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Conclusion

The docking arrangement of different DeFi projects with Sun.io has earned additional bonuses for the Liquidity providers in the recent past. The dividend for Liquidity providers is not limited to earning a share from exchange fees, Sun.io has created an avenue through LP mining to generate an additional reward for Liquidity providers in five different tokens(TRX, SUN, JST, BTT, WIN). It's a win-win scenario as staking LP token now earns five different tokens and definitely adds a new dimension to DeFi.

Note- Recently BTCST token is added to Tron Century Mining, so instead of 5 different tokens, you will now earn 6 tokens(TRX, SUN, BTT, JST, WIN, and BTCST) as mining rewards.

Thank you.

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Homework Task (Season 2/Week-7)

(1) How do I connect my TronLink Wallet to Sun.io?(Screenshots needed)

(2) What are the different liquidity mining pools? Which one offers the highest APY? How many different rewards do I get by staking LP token? (Screenshots needed)

(3) How do I obtain LP Token by adding liquidity in Justswap? What is the quantity(Explore through your wallet/Tronscan)?(Screenshots needed)

(4) How do I stake LP Token to earn five different tokens on Sun.io? (Screenshots needed)

(5) Which reward(out of five different rewards) can be withdrawn at any time? How do claim that (indicate that in the screenshot)?

(6) What is the schedule of unlocking the mining rewards? Indicate the total undistributed/distributed mining rewards in the screenshot?

(7) Include the real example of your interaction with Justswap and Sun.io as required in this task? Indicate how a "stake"(in Sun.io) function consumes different "Energy & Bandwidth" than "obtaining LP token" (in Justswap)? You should add/remove a small amount of liquidity to obtain/redeem your LP token(as little as 1 USDT worth)? (Screenshots needed)

(8) How do I unstake LP token and claim mining rewards(Sun.io)?

Important Note-

With the rise of STEEM price, the purchasing power of Steemians has greatly improved, therefore we expect the participants of this task to showcase a real example using Justswap & Sun.io. You can do a micro-transaction (if you don't have sufficient funds). This will help you gain real experience.

Guidelines

  • Your article should be at least 300 words.
  • It is always better to gain user experience before submitting your article.
  • Refrain from spam/plagiarism. This task requires screenshot(s) of your own experience. Use images from copyright-free sources and showcase the source, if any.
  • This homework task will run until 29th May'2021, Time- 11:59 PM UTC.
  • Users having a reputation of 50 or above, and having a minimum SP of 100(excluding any delegated SP) are eligible to partake in this Task.
  • Add tag #sapwood-s2week7 #cryptoacademy in your post and should be among the first five tags. You can also use other relevant tags like #defi #tronscan #sun-io or any other relevant tag.
  • Those who include the real examples/screenshots will score better.
  • If you are using a wallet other than Steem integrated Tron wallet, you should mention it at the beginning of the post, so that we can verify the transactions required in this Task.

(Please feel free to join the comment section if you have any doubt on Homework-Task)

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Cc:-
@steemitblog
@steemcurator01
@steemcurator02

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Unless otherwise stated, all the images, infographics, charts, tables, etc(if any) are my original works. The screenshots are taken from Justswap, Sun.io, etc.

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Sort:  

Greetings teacher, I ask your permission to republish my last assignment, I had a score of 5.5 and it was not voted.

I take the opportunity to thank you for all the valuable knowledge you have taught me throughout all these weeks

God bless you

https://steemit.com/hive-108451/@ramsesuchiha/crypto-academy-week-13-homework-post-for-professor-sapwood-bandwidth-and-energy-tron-esp

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 4 months ago (edited)

Okay. I think this post has already reached payout. I will request the team to consider this in your next task.

But, please don't republish.

Thank you.

Ok teacher thank you, I would really appreciate it, it took a long time to do the homework

Dear professor @sapwood, the students who are listed in Black list, How they get out from black list? What should they after listed in Black list? and whether they will be removed from the blacklist or no?

Kindly guide

This is my homework assignment from professor @fendit, it's been 2 days but professor @fendit haven't checked it.

https://steemit.com/hive-108451/@ichsananggap/season-2-or-week-6-steemit-crypto-academy-homework-post-for-fendit-or-elliott-wave-theory-or

Please Check My Homework

 4 months ago 

Have patience dear.

All are being checked chronologically.

Thank you.

Please answer my question please.

How do I get out of the black list?

I have come to realize that yes i have plagiarize more than once in this community, I am commenting this to ask for a second chance for everybody in that blacklist.

@sapwood please consider my request because we have accepted that we are guilty but we are ready to change and be a better author if you just give us a chance please

@sapwood thank you for sharing such an informative post. Stay blessed and safe.

existe algún parámetro que cumplir para ingresar a la cripto academia? como me gustaria aprender sobre todo esto pero desde inicios es popsible?

 4 months ago 

Eligibilty Criteria--

  • Must have a reputation fo 50 and above
  • Must have a min SP of 100
  • Must not power down
  • Should not have a history of spam/plagairism(we maintain a sheet of repeat offenders you should not feature in that list)

Then visit https://steemit.com/trending/hive-108451

Go through the pinned posts to submit any Task of your choice (you can participate in as many as 5 tasks every week).

I hope it clarifies.

Thank you.

Perfecto entonces creo que puedo iniciar muy agradecida por responder

Hello prof., please confirm it

By staking LP tokens, you start mining in Sun.io. You can mine 5 different tokens(TRX, JST, BTT, SUN, WIN).

As in the screenshot, there are 6 different tokens including TRX.

reward tokens.jpg

Thanks!

 4 months ago (edited)

Yes, BTCST is recently added to the Tron Century Mining. So you can write what you see and experience.

I hope it clarifies.

Thank you.

One more great lecture.

Homework Task (Season 2/Week-5)

I think you need a small correction. As we are in week 7.

 4 months ago 

Thanks for the proof-reading.

Now corrected.

 4 months ago 

https://steemit.com/hive-108451/@chilaw/steemit-crypto-academy-season-2-week-6-elliott-wave-theory-post-by-prof-fendit

Hello Prof @fendit, kindly help verify my post. This is the 3rd day and it's yet not verified. Thanks

 4 months ago 

liquidity mining made easy. Nice post

Hello prof., In this question

Include the real example of your interaction with Justswap and Sun.io as required in this task? Indicate how a "stake"(in Sun.io) function consumes different "Energy & Bandwidth" than "obtaining LP token" (in Justswap)? You should add/remove a small amount of liquidity to obtain/redeem your LP token(as little as 1 USDT worth)? (Screenshots needed)

We have to compare energy and bandwidth consumption in staking and unstacking LP token? Please clarify. Thanks!

 4 months ago 

No.

Staking on Sun.io Vs obtaining LP Token in Justswap

Thank you.

Ok got it, thanks.

 4 months ago 

What a great lecture yet again by you professor @sapwood. I've made my entry for the task and below is the link to it. Thank you, sir.

https://steemit.com/hive-108451/@fredquantum/crypto-academy-week-15-or-homework-post-for-sapwood-or-liquidity-mining-tron-sun-io

 4 months ago 

Hello professor, I just wanted to tell you that I have in my tronlink account these tokens TRX, SUN, BTT, JST, WIN, as you can see in the capture, because I have previously exchanged TRX for BTC and ETHER, and these last weeks have appeared these tokens TRX, SUN, BTT, JST, WIN in my tronlink account. so I still have to do the exercise that you sent us complete.

tronlink.jpg

 4 months ago 

See, here in this task, you are asked to obtain LP token. And then you have to stake your LP token on Sun.io.

In Justswap, you might have exchanged one asset for another, but here we are more interested in LP token. So if you have LP token, then you can produce the details of it in the Task, if not, then you should add liquidity in Justswap to obtain LP token.

Thank you.

Good day prof. @sapwood

Sir I know according to Steemitblog.

You and professor fendit work in pair.

So that's why you have the authority that you can check our work and give your comments .

So please chek and verify my work. I shall be very thankful to you.

Note: I posted my work on time .

I do not know why the professor @fendit did not check my work.

Here is link to my work.https://steemit.com/hive-108451/@adnanyassin/homework-task-season-2-week-6-by-prof-fendit-or-or-elliott-wave-theory-or-or

 4 months ago 

Ok, let me have a follow-up.

Thanks for your feedback.Its really honour for me that you checke my work.

Good day professor @sapwood

My homework post for professor @fendit last week has not been reviewed and it's been four days already.

It was posted on time sir.

Please help me get my work reviewed.

Here's the link below:

https://steemit.com/hive-108451/@uchescrib/crypto-academy-week-14-homework-post-for-fendit

Thank you

 4 months ago 

Okay, let me have a follow-up.

Thank you.

Hey @sapwood professor , I'm kinda confused with the distributed and undistributed rewards , may you explain , please .

 4 months ago 

Pay attention to this screenshot--

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Here you can find total undistributed rewards.

If you have staked previously and already one week old, then you have already been distributed with your weekly rewards(mining rewards to unlock over a total of 24 weeks)

Thank you.

I read your article, really good😊👍🏻 and I am new here. Plz check my post in SteemitCryptoAcademy and plz guide me.
THANK YOU😊🌸

Start from the newcomer's community and do the achievement tasks

Also explore other communities until you get to a reputation of 50

 4 months ago 

Being a newcomer, you should first enroll yourself in the Newcomers' community. By doing so you can develop a better understanding of this ecosystem.

 4 months ago 

Hello teacher, here is my homework for this week, it took me a long time to do it, but here it is finished.

https://steemit.com/hive-108451/@danay/crypto-academy-week-15-homework-post-for-sapwood-or-season-2-week7-liquidity-mining-tron-sun-io

Hii @sapwood .. how are you?
I'm really sorry that I'm knocking you here , I need your help seriously. This is the first time I've tried to arrange a contest in #musicforsteem. But I don't know the present admin of musicforsteem, moreover I need to pin my post there otherwise this Contest will loss it's Beauty. Would you please help me dear for this purpose?? It's my request.
Here is my contest link:
https://steemit.com/hive-137433/@isha.ish/music-for-steem-monsoon-special-challenge-or-or-20-steem-prize-pool

 4 months ago 

Hello sir @sapwood my homework task has been been review it is two days now please sir look in to it https://steemit.com/hive-108451/@jasminemary/crypto-academy-week-15-or-homework-post-for-sapwood-liquidity-mining-tron-sun-io

 4 months ago 

All are being curated chronologically.

I will find you soon.

Thank you.

Buenas tardes profesor, por acá le comparto mi tarea. Saludos y Bendiciones...

Buenas tardes profesor @sapwood saludos Puede observar que ya califico una tarea que le enviaron despues de la mía, por favor si es tan amable para que la revise. Y me de su calificación

 4 months ago (edited)

Hola profesor aqui vuelvo a publicar mi tarea por corrección de Etiquetas me disculpo por el error de traducción

https://steemit.com/hive-108451/@walter2021/steemit-crypto-academy-or-temporada-2-semana-7-mineria-de-liquidez-tron-sun-io-por-sapwood

I am late professor sapwood, please ask you to review my assignment, even if I don't receive a reward, I would at least like to receive your corrections. They will be very helpful for my future assignments.

Crypto Academy Week 15 | Homework post for @sapwood [Liquidity Mining]