How does liquid XAI staking work?
Last updated
Last updated
Learn more about the tokens in our ecosystem and their utility. This page covers common use cases for each token and explains in detail how the system works when you interact with them.
You want to earn yield while having the flexibility to sell your earnings and stake at any time on decentralized or centralized exchanges for other assets.
You want to borrow, for example, ETH and use stXAI as collateral. Since stXAI increases in value over time, it could cover the interest on your loan and may even start paying off your ETH loan automatically.
You want to sell your stXAI for XAI, so you should first convert it to alXAI. Then, use alXAI to trade for XAI, as it maintains a 1:1 value with XAI, ensuring stability and minimizing exit fees on decentralized exchanges (DEXs).
You want to earn trading fees and other incentives by providing liquidity in an alXAI/XAI pool on decentralized exchanges (DEXs).
You want to earn yield while having the flexibility to sell your earnings and stake at any time on decentralized or centralized exchanges for other assets.
You want to trade your alXAI for XAI to sell it for other assets on centralized or decentralized exchanges (DEXs).
You want to withdraw directly when there isn't enough liquidity to trade stXAI or alXAI for XAI on an exchange, giving you peace of mind that you can always get XAI for your stXAI and alXAI.
stXAI tokens are tied to the overall rewards earned from staking. All yield collected by the locker is distributed directly to stXAI token holders by continuously increasing the value of each share.
In a non-rebase liquid staking token (LST) model, like stXAI, the number of tokens you hold stays the same, but the value of each token increases as rewards are earned. Here’s a more concrete example:
Let’s say you initially stake XAI and receive 1 stXAI in return.
Over time, as staking rewards are accrued, the value of your stXAI increases relative to the underlying assets, such as alXAI or XAI.
After a certain period, 1 stXAI might be worth 1.05 alXAI/XAI. Later, as more rewards accumulate, 1 stXAI could be worth 1.10 alXAI/XAI, and so on.
