Explained: Staking, Farming, and Liquidity Pools in RFOX Finance

For more than a year, DeFi (short for decentralized finance) has been one of the pillars of the crypto industry. Since its boom in mid-2020, crypto-financial products have grown in popularity, providing a viable alternative to traditional finance. Nowadays, there is a crypto version of typical finance products, from savings and loans to more sophisticated instruments, each with higher yields than their traditional counterparts.

Some of the most common DeFi activities in the market are staking, farming, and participating in liquidity pools. This article explains these tasks and how you can earn from them.

Staking: Simple, Straightforward Earnings

Staking is the act of combining assets of a certain crypto token in a crypto financial instrument called a staking pool. When multiple crypto holders contribute to this pool, it grows so that it can be used for earning crypto rewards.

How does the simple act of storing your crypto in a pool yield earnings? Many cryptocurrencies’ blockchains operate through a Proof-of-Stake (PoS) consensus algorithm. Under PoS, the process of verifying and validating new blocks on the blockchain depends on the staking power of a certain node. When there are more tokens in a staking pool, your combined computational results translate to better chances of earning rewards from that blockchain.

However, in the context of DeFi, staking pools can be used to lock liquidity into DeFi protocols, resulting in the maintenance of enough resources to keep a DeFi product running. To further incentivize holders, a DeFi product can offer a share of the revenues generated from the use of the staking pool.

Due to this straightforward method of earning, staking pools are attractive options for crypto holders who seek a simple way to make the most out of their investments. It requires you to maintain a stake of just one particular token, compared to other DeFi products that may require two kinds of tokens.

For instance, RFOX Finance has historically offered RFOX-VFOX, VFOX-RFOX, and VFOX-VFOX staking pools. The first token indicated in the pair stands for the token that needs to be staked in the pool, while the second token indicates the reward to be harvested for your staking activity.

Farms and Liquidity Pools: More Earning Opportunities

But what if you want to have multiple ways to earn through your crypto tokens? This is where DeFi farming and liquidity pools enter the picture.

A liquidity pool (LP) is a decentralized crypto-financial platform where participants can provide liquidity by storing two kinds of crypto tokens needed for the pool to be operational. When DeFi protocols create LPs, they build a decentralized trading pair using tokens being supplied by liquidity providers. You can become a liquidity provider for an LP by contributing enough amounts of the two tokens being used there, in such a way that the two tokens maintain a 1:1 peg at market value.

LPs generate earnings for liquidity providers when other people use them for swapping tokens and pay a corresponding fee for the service. Another way for a liquidity provider to generate earnings from an LP is through their receipt of LP tokens.

When you get your LP tokens, you unlock a new earning opportunity through farming, which is the process of staking your LP tokens in a farm dedicated to those tokens. By keeping your LP tokens in their corresponding farming pool, you get to receive your earnings depending on the terms of the farming pool.

For instance, if you provide tokens to the RFOX-VFOX LP by RFOX Finance, you get a corresponding RFOX-VFOX LP token that reflects your share of the pool. You stand to earn a share of the fees generated by the LP, in addition to the rewards you gain from staking your LP tokens in a farm dedicated to those.

Overall, participating in LPs and farms requires more proactive involvement on the part of the user, but it also unlocks higher yields from multiple earning mechanisms. Just keep in mind that there are risks involved in LPs, such as impermanent loss, or the possibility that tokens can get temporarily lost from the LP supplier in in order to maintain a 1:1 market value ratio for the LP.

How RFOX Finance Gives Greater Earning Opportunities for the RFOX Community

When RFOX Finance creates DeFi products, its top priority is offering the RFOX community attractive options for keeping their RFOX token holdings and earning from them as well. The most recent DeFi product launches from RFOX Finance involve two staking pools (RFOX-VFOX and VFOX-RFOX) plus a farm for RFOX-VFOX LP tokens. These DeFi products are near their end, specifically at block 13920000 on Binance Smart Chain (BSC). Thanks to those in the RFOX community

More importantly, as we close out the year, RFOX Finance has more in store for you. We are introducing the following DeFi products, which will start paying out rewards at block 13920000 on BSC, at around 6 AM UTC on December 30. You can start staking in advance now on the RFOX Finance website.

1. RFOX-VFOX Staking Pool

Mechanics: Stake RFOX tokens to earn VFOX tokens

Details: We’ve bought back 50,000 VFOX tokens from the market to offer as rewards in this new RFOX pool. For this RFOX staking pool, we will distribute 50,000 VFOX in rewards over 90 days.

Total tokens: 50,000 VFOX

Distribution duration: approximately 90 days

Start block: 13920000 on BSC (approximately 6 AM UTC on December 30, 2021)

Finish block: 16512000 on BSC (approximately 6 AM UTC on March 30, 2022)

Token rewards per block: Around 0.019 VFOX

Maximum stake per wallet: 10,000 RFOX

2. VFOX-RFOX Staking Pool

Mechanics: Stake VFOX tokens to earn RFOX tokens

Details: The RFOX VALT Arkamoto auction rewards will be distributed via this pool, and you can stake and unstake at any time. For this VFOX staking pool, we will distribute 1,700,000 RFOX in rewards over 90 days

Total tokens: 1,700,000 RFOX

Distribution duration: Approximately 90 days

Start block: 13920000 on BSC (approximately 6 AM UTC on December 30, 2021)

Finish block: 16512000 on BSC (approximately 6 AM UTC on March 30, 2022)

Token rewards per block: Around 0.656 RFOX

Maximum stake per wallet: No maximum

3. RFOX-VFOX LP Farming Pool

Mechanics: Stake RFOX-VFOX LP tokens to earn RFOX tokens

Details: We offer you a new staking Pool for RFOX-VFOX LP token holders. Thanks to the success of the RFOX VALT Arakmoto Auction, we will distribute 1,700,000 RFOX in farm rewards over 90 days.

Total tokens: 1,700,000 RFOX

Distribution duration: Approximately 90 days

Start block: 13920000 on BSC (approximately 6 AM UTC on December 30, 2021)

Finish block: 16512000 on BSC (approximately 6 AM UTC on March 30, 2022)

Token rewards per block: Around 00.656 RFOX

Maximum stake per wallet: No maximum

New on RFOX Finance: DeFi Products on Ethereum

But wait, there’s more. As a testament to RFOX Finance’s continued efforts to expand its DeFi offerings to more blockchains, we are introducing the venture’s first-ever DeFi product on the Ethereum blockchain: the RFOX-ETH LP Farm. This means that we are launching a new LP for RFOX-ETH, which will begin paying out rewards on block 13905269 on the Ethereum blockchain, which is estimated to at 6 AM UTC on December 30.

RFOX-ETH LP Farming Pool

Mechanics: Stake RFOX-ETH LP tokens to earn RFOX tokens

Details: For this Farm on Ethereum, we will distribute 1,000,000 RFOX in rewards over 90 days.

Total Tokens: 1,000,000 RFOX

Distribution duration: Approximately 90 days

Start block: 13905269 on Ethereum (approximately 6 AM UTC on December 30, 2021)

Finish block: 14481269 on Ethereum (approximately 6 AM UTC on March 30, 2022)

Token rewards per block: Around 1.736 RFOX

Maximum Stake per wallet: No maximum

You can start staking your RFOX-ETH LP tokens on December 28, 2021.

To know more about the mechanics of using RFOX Finance’s farms and pools, go to this FAQ page.

Go to RFOX Finance Now

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