Staking

What is Staking?

Staking is the primary value accrual strategy of Piggybank. Stakers stake their PB tokens on the Piggybank website to earn rebase rewards. The rebase rewards come from the proceed from bond sales, and can vary based on the number of PB staked in the protocol and the reward rate set by monetary policy.

Staking is a passive, long-term strategy. The increase in your stake of Piggybank translates into a constantly falling cost basis converging on zero. This means even if the market price of PB drops below your initial purchase price, given a long enough staking period, the increase in your staked PB balance should eventually outpace the fall in price. When you stake, you lock PB and receive an equal amount of sPB. Your sPB balance rebases up automatically at the end of every epoch. sPB is transferable and therefore composable with other DeFi protocols. When you unstake, you burn sPB and receive an equal amount of PB tokens. Unstaking means the user will forfeit the upcoming rebase reward. Note that the forfeited reward is only applicable to the unstaked amount; the remaining staked PB (if any) will continue to receive rebase rewards.