Stargate USDT Boost 2023: All You Need to Know
We are boosting yield returns on our Stargate USDT opportunity for a limited period, as showcased on Bankless, to celebrate the arrival of our cross-chain yield portal.
For a period of three months (until June 1), the normal yield on Stargate USDT will be increased by a total of 7%. Based on the current yield provided by our launch partner Beefy Finance, this gives a total annual percentage yield, or APY, of around 15% today (we explain how the APY is calculated below).
Is there any limit on my rewards?
Yes. The boost only applies to the first $1,000 you invest.
Once you have invested more than $1,000, you will return to the regular yield provided by Beefy Finance.
What is Stargate and why do they need liquidity?
Stargate Finance is a bridge built on LayerZero, an interoperability blockchain. Essentially, Stargate sits on a new chain, above regular blockchains like Ethereum and Polygon, and enables traders to transfer assets from one to another.
By providing liquidity to the bridge, Stargate will reduce the potential price impact when traders send their assets across.
How does the Stargate USDT opportunity work?
Beefy Finance is a yield aggregator that wraps existing opportunities (essentially, creates an overlay so it can provide the opportunity itself).
When Beefy provides Stargate USDT, it handles the compounding process for you: in other words, it continually claims your rewards and adds them to your initial investment, so you earn more than a regular interest payment, and you don't have to claim or reinvest yourself (a process which would require gas fees).
Here's how it works:
You start with USDT on Rhino and we then bridge that into Polygon, once you have indicated your request via a user signature.
On Polygon, we then take that USDT and deposit into the Stargate pool. In return we get Stargate liquidity provider (LP) tokens, which we deposit in the Beefy finance vault. This gives us receipt tokens which are held in the rhino.fi smart contract (controlled by you).
Meanwhile, Beefy continues to compound the original investment. In other words, the interest is collected at regular intervals and added to your initial investment in the Stargate pool, along with any bridging transaction fees you've earned.
The next portion of interest is earned on this new figure, rather than the original. This cycle continues to repeat itself, so you earn progressively more rewards each time.
The compounding period is irregular and based on several factors, such as the amount of yield earned, the gas fees and the amount of activity in the pool.
As well as handling the compounding for you, the Beefy wrapper also means you can enter and exit easily, and you don't face significant exposure to Stargate’s native token.
How are my rewards calculated?
Your rewards are based on annual percentage yield, or APY. This figure is slightly higher than the interest rate, because you have invested in a compounding asset.
As discussed above, your investment doesn’t just pay out a flat return once a year: it harvests itself periodically, collecting a fraction of the interest, adding this interest onto your base investment and harvesting the next fraction on this new figure.
So your investment keeps growing, which means the interest payments continue to increase. We’ve got an explainer on how APY works, which you can find here.
What are the risks associated with the Stargate USDT opportunity?
The following warning is taken from Beefy finance:
When you stake your USDT into the Beefy Finance Stargate Vault, you are exposing yourself to certain risks, which include but are not limited to:
Beefy Finance smart contract risk
Stargate Finance smart contract risk
For a period of three months (until June 1), the normal yield on Stargate USDT will be increased by a total of 7%. Based on the current yield provided by our launch partner Beefy Finance, this gives a total annual percentage yield, or APY, of around 15% today (we explain how the APY is calculated below).
Is there any limit on my rewards?
Yes. The boost only applies to the first $1,000 you invest.
Once you have invested more than $1,000, you will return to the regular yield provided by Beefy Finance.
What is Stargate and why do they need liquidity?
Stargate Finance is a bridge built on LayerZero, an interoperability blockchain. Essentially, Stargate sits on a new chain, above regular blockchains like Ethereum and Polygon, and enables traders to transfer assets from one to another.
By providing liquidity to the bridge, Stargate will reduce the potential price impact when traders send their assets across.
How does the Stargate USDT opportunity work?
Beefy Finance is a yield aggregator that wraps existing opportunities (essentially, creates an overlay so it can provide the opportunity itself).
When Beefy provides Stargate USDT, it handles the compounding process for you: in other words, it continually claims your rewards and adds them to your initial investment, so you earn more than a regular interest payment, and you don't have to claim or reinvest yourself (a process which would require gas fees).
Here's how it works:
You start with USDT on Rhino and we then bridge that into Polygon, once you have indicated your request via a user signature.
On Polygon, we then take that USDT and deposit into the Stargate pool. In return we get Stargate liquidity provider (LP) tokens, which we deposit in the Beefy finance vault. This gives us receipt tokens which are held in the rhino.fi smart contract (controlled by you).
Meanwhile, Beefy continues to compound the original investment. In other words, the interest is collected at regular intervals and added to your initial investment in the Stargate pool, along with any bridging transaction fees you've earned.
The next portion of interest is earned on this new figure, rather than the original. This cycle continues to repeat itself, so you earn progressively more rewards each time.
The compounding period is irregular and based on several factors, such as the amount of yield earned, the gas fees and the amount of activity in the pool.
As well as handling the compounding for you, the Beefy wrapper also means you can enter and exit easily, and you don't face significant exposure to Stargate’s native token.
How are my rewards calculated?
Your rewards are based on annual percentage yield, or APY. This figure is slightly higher than the interest rate, because you have invested in a compounding asset.
As discussed above, your investment doesn’t just pay out a flat return once a year: it harvests itself periodically, collecting a fraction of the interest, adding this interest onto your base investment and harvesting the next fraction on this new figure.
So your investment keeps growing, which means the interest payments continue to increase. We’ve got an explainer on how APY works, which you can find here.
What are the risks associated with the Stargate USDT opportunity?
The following warning is taken from Beefy finance:
When you stake your USDT into the Beefy Finance Stargate Vault, you are exposing yourself to certain risks, which include but are not limited to:
Beefy Finance smart contract risk
Stargate Finance smart contract risk
Updated on: 14/03/2023
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