pStake

WHAT IS PSTAKE?

pSTAKE is a liquid staking protocol that unlocks the true potential of staked PoS assets (e.g., ATOM). PoS token holders can deposit their tokens onto the pSTAKE platform to mint 1:1 pegged ERC-20 wrapped unstaked tokens represented as pTOKENs (e.g., pATOM). Users can convert pTOKENs into 1:1 wrapped ERC-20 staked representatives called stkTOKENs by staking the underlying deposited PoS tokens. stkTOKENs, representing staked tokens, accrue staking rewards in the form of pTOKENs (This mirrors the workings of most PoS chains where staking rewards aren't automatically compounded but earned in the form of liquid tokens which can be claimed by a user at any point in time).

pSTAKE allows its users to utilize stkTOKENs in various DeFi protocols to earn additional yield on top of their staking rewards.

Example: Alice wraps (deposits) 100 ATOM on pSTAKE. She receives 100 pATOM representing 100 ATOM deposited onto the pSTAKE platform. As long Alice has 100 pATOM, she can redeem 100 ATOM (1:1) from the platform back into her Cosmos wallet by burning off her pATOM balance (This is the unwrapping process).

After receiving 100 pATOM, she decides to stake the underlying deposit of 100 ATOM on the Cosmos Hub to earn staking rewards (assume ~7% Annually). On staking, Alice receives 100 stkATOM, and her pATOM balance is now changed to 0 (pATOM burned, stkATOM minted). Let's assume there's an already existing stkATOM-ETH liquidity pool on SushiSwap. Alice supplies all her stkATOM and an equivalent amount of ETH into the Sushi pool to become a liquidity provider (LP). A portion of the trading fees generated on SushiSwap is distributed to all the LPs (Assume that this results in 9% yields annually). Thus, if Alice doesn't face any Impermanent loss at the end of the year, she would earn (7+9)% yield on her 100 ATOM holdings instead of the usual 7% she would have received by simply staking (and not liquid staking). Alice, being a PoS coin staker, leverages pSTAKE's technology to generate additional yield.

Key Value Propositions:

pBridge

The pSTAKE protocol uses an inter-blockchain bridge named ‘pBridge’ which facilitates the transfer of value between various blockchains, such as Ethereum, Cosmos, Persistence, among many others. While other blockchain bridges only allow for the creation of pegged tokens, pBridge enables interchain staking and unstaking of PoS tokens at the protocol level on their respective native chains.

The purpose of the pBridge is primarily to:

• Mint 1:1 pegged ERC-20 wrapped representatives or pTokens
• Stake and unstake these PoS tokens that are deposited on the pBridge
• Accrue and claim respective staking rewards and replicate them onto the Ethereum blockchain

pBridge implements Crash Fault Tolerance by being a multi-party computation based bridge that is secured by some of the industry leading Proof-of-Stake validators.

Dual Token Model:

The dual token model of pSTAKE simplifies staking and rewards mechanisms for users and mirrors the exact workings of the PoS networks that it supports.

pTokens are 1:1 pegged ERC-20 unstaked representative tokens that copy the functionality of the underlying PoS network and only represent unstaked tokens on that network. Users can then stake their pTokens with pSTAKE to mint stkTokens, which are 1:1 pegged staked representative tokens. In the background, the PoS assets deposited on the protocol are staked onto the network with leading PoS validators. stkTokens accrue staking rewards in pTOKENs which can also be used in the broader Ethereum DeFi ecosystem.

Fungibility:

All issued stkTokens are fungible in nature.

This fungibility is achieved by delegating assets staked on the respective PoS networks evenly across a set of validators participating in the pSTAKE protocol. This proportion of stake distribution will be governed by $PSTAKE token holders after the token launch.

stkToken holders equally share the risk of slashing in the ecosystem. However, these slashing risks are mitigated to a large extent through distributed delegation across multiple validators.

Token Utility and Economics:

PSTAKE is an ERC-20 token that provides its holders with a two-fold benefit:

• Participation in protocol improvement proposals through voting
• Participation in protocol security

The PSTAKE token functions as the governance and incentivisation/dis-incentivisation token of the pSTAKE protocol. PSTAKE holders are incentivised to participate in the protocol’s governance to ensure its long-term success and security by staking PSTAKE on the pSTAKE staking contract. PSTAKE token holders will have the immediate ability to use the token for its intended functionality .

PSTAKE tokens will also be used as a dis-incentivization token in case stakeholders staking PSTAKE act maliciously or are unable to perform their respective duties appropriately.

Read more about the PSTAKE utility token and its role in the pSTAKE ecosystem here.

Token Distribution & Release Schedule:

PSTAKE has a total genesis supply of 500,000,000 tokens.

• Alpha Launchpad - 2% Fully liquid on TGE
• Seed Sale - 20% 18 month total vesting period: 6-month cliff, followed by 12-month equal monthly vesting
• Public Sale - 5% 25% vesting at TGE, followed by a 6-month linear vesting schedule
• Team - 16% 36 month total vesting period: 18 month cliff, followed by 18-month equal monthly vesting
• Incentivisation & Community Development - 26% 24-month total vesting period: quarterly-vesting starting from TGE
• XPRT Stakers - 3% 12-month total vesting period: equal monthly-vesting starting from TGE
• Treasury - 20% 24-month total vesting period: Alternate month equal vesting starting from TGE
• Protocol Bootstrapping - 2% Fully liquid on TGE
• Retroactive Rewards - 6% 6-month linear vesting starting from TGE