Anchor Protocol to shift towards dynamic earn rate starting at 18% APY

Anchor Protocol, which launched DeFi’s cross-chain savings product on Terra with 20% APY, is now moving towards a more flexible and dynamic earn rate.

The Anchor Earn rate adjusts dynamically by up to 1.5% each month depending on whether the yield reserve appreciated or depreciated. If the yield reserve is growing, the earn rate could increase; if the yield reserve is falling, the rate could decrease. The Earn rate would update approximately every 388068 blocks, or once every month.

There are two parameters that can be changed by governance:

  • Frequency of changes
  • Cap on rate adjustments

Currently, the earn rate frequency changes is 1 month, and the cap on rate adjustments is set at 1.5%. Furthermore, the floor for Earn rates is 15% APY & the ceiling is 20% APY.

The addition of a semi-dynamic Earn rate will contribute to the long-term sustainability of Anchor & will benefit users of the protocol by enabling yield reserve growth while continuing to provide an attractive yield on UST.

Subscribe to our newsletter so that you don’t miss our latest updates! Join as a Medium member and get unlimited access to Medium for just $5 monthly.

--

--

--

Staking bits and bytes. DeFi’s fastest growing content platform helping investors navigate DeFi’s wild forest.

Love podcasts or audiobooks? Learn on the go with our new app.

Recommended from Medium

“That’s Our Two Satoshis” — A Tale of Two Utility Tokens

SpaceX to follow Tesla in accepting DOGE payments for merch: Elon Musk

Nexo and Chainlink Collaborate to Accelerate the Adoption of Digital Assets

Changelly September Digest — News, Updates, Events

Hedera Hashgraph Price Prediction 2021

Socialogue Partners with SODA Protocol

CryptoCurreny & Blockchain News| 18.12.2020

Grand Opening of SushiSwap

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Stakingbits

Stakingbits

Staking bits and bytes. DeFi’s fastest growing content platform helping investors navigate DeFi’s wild forest.

More from Medium

Crypto.com cripples card rewards program with massive changes

Staking DAO has Launched!

Surviving A Bear Market With Your Crypto Portfolio

Moving from bonds to staking crypto: how can we get the experience to match the benefits?