Stake DAO removes the need to stake your assets across multiple platforms, and brings together the market’s highest-yielding strategies all under one roof. From Stake DAO, users can search through the best of DeFi and choose from the best products to help them beat the market.
SDT is the token of Stake DAO. Owning SDT makes you a partial owner of all fees generated by the Stake DAO protocol. Compare staking SDT to holding dividend stocks, which allows you to receive an annual dividend on the company earnings.
Whereas most stock dividends are paid annually and range mostly between 1 – 5%, the Stake DAO protocol currently generates revenue which entitles SDT holders to a “dividend” of around ~95% annualized (and is paid out weekly).
How does Stake DAO generate revenue?
Stake DAO generates revenue using a a 15% performance fee and 0.5% withdrawal fee applied on their offered strategy products.
Stake DAO currently allows you to deposit USD stablecoins, BTC, ETH, EUR stablecoins, and CRV in order to establish passive income streams on assets that would otherwise idle in your portfolio.
With competitive yields and further incentivization through SDT farming, at the time of writing, Stake DAO has accumulated a TVL of around $161M USD across Ethereum, Polygon, BSC, and staking protocols. The revenue of Stake DAO is made up of a 15% performance fee of all earnings generated by these assets, as well as a 0.5% withdrawal fee.
As more assets are deposited into Stake DAO strategies and protocols, more revenue will be generated.
The revenue of the protocol is paid back to SDT stakers according to how much SDT they have staked.
Currently, 33% of all eligible SDT are being staked in the governance vault, which is called the “Sanctuary”.
Is there any risk to staking SDT?
When staking SDT, you are depositing into a smart contract on the Ethereum Blockchain. Please consider that smart contracts may have bugs that could drain all your staked tokens. However, the Stake DAO staking contract is a fork of the battle-tested Sushi Staking Module. Even with over $3B tokens at stake, no one has been able to exploit this contract. Furthermore, it has also been audited by independent security researchers.
How to buy $SDT?
In case you would like to purchase SDT for any other tokens, you would be able to make use of the proprietary Paraswap Routing mechanism that allows you to swap SDT for any other liquid asset on the market.
How to stake SDT?
In order to start staking your SDT and earn a share of the protocol-generated revenue, there is only one thing you need: An Ethereum Metamask Wallet with SDT and some ETH.
- Head over to https://stakedao.org/
- Open the app, and connect your Metamask Wallet
- Visit the Governance Tab
- Click on “Stake SDT”
- Enter the SDT amount you would like to stake or click the circle icon and “100%” to stake all.
In the next step confirm your stake transaction within 2 transactions.
- Click “Approve SDT” and confirm the transaction in your Metamask.
- Click “Stake” and confirm the transaction in your Metamask
Once both transactions are confirmed, you will see this notification in the bottom right corner, and should now be able to see xSDT tokens in your wallet. Those tokens are a representation for your staked SDT.
With xSDT, rewards are automatically compounded, and claiming them requires no further action.
Inside the governance dashboard, you can now watch your SDT stake grow. Under “Staked” you will see the amount you have initially deposited, and under “Claimable Amount”, you will see the total amount that you are currently entitled to withdraw.
You can withdraw your SDT stake at any time. To do so, simply enter the same module and click “Unstake”.
Congratulations! You are now receiving dividends from the Stake DAO protocol on a regular basis.