Today, we are thrilled to introduce Double Restaking! It solves a big dilemma in crypto — staking vs AMM LPing, which one to choose? With Double Restaking, token holders can actively participate in both and capture the value from both. More importantly, it empowers token projects to make use of the “locked but non-productive” tokens, to not only support their tokens’ on-chain liquidity but also enrich their treasuries or token holders.
In crypto, there are only 2 long-term sustainable revenue sources — staking or AMM LPing. A token can be used to either participate in staking and earn staking rewards or participate in AMM LPing and earn AMM trading fees, but not both. Token holders face a dilemma to choose between staking which offers lower yields but is less risky, and AMM LPing which offers higher yields but is more risky.
Staking has been expanded beyond the initial use case — PoS. One well-known use case is staking for governance, where token holders lock their governance tokens to vote (or delegate to vote), and receive rewards either in fees collected by the protocol or token rewards or both. The most popular model in the past is the veToken model where the veToken is non-transferrable. Recently, the liquid staking model is gaining momentum, for example, the ARB staking proposal in Arbitrum DAO where LST ARB token can be integrated with other DeFi protocols.
Whether in the veToken model or in the liquid-staking model, the governance tokens locked inside smart contracts are unused, idle and non-productive. While, as one of the design goals, staking reduces token circulation to a degree, token projects still face the liquidity challenges. Double Restaking makes use of the non-productive assets to not only solve the liquidity challenges faced by token projects but also offer additional revenues to either treasuries, or token holders or both via Double’s own incentive Double Dip Joy (DDJ), which has no premine & strong protocol native demand. It is another example of the spirit of double2win!
As shown in the above diagram, non-productive governance tokens locked inside gov-staking smart contracts can be deposited into the token side of Double via smart contract to smart contract integration. When capital providers supply stable or WETH into Double, those governance tokens will be matched to create AMM LP positions and hence increase on-chain liquidity for those projects. Even though the token side won’t earn trading fees by design, it will receive Double’s incentive — DDJ, which can be distributed to treasuries, or token holders or both depending on design decisions made by the governance.
In the current design, the token side will always get back the same number of tokens being matched to the capital side. The well-known impermanent loss risk in AMM does not apply here. In addition, those tokens can’t NOT be dumped in the market. Only when someone purchases tokens above the entry price, will these tokens get into circulation. More importantly, no more dilemma for token holders — they can actively participate in staking and AMM LPing and capture the value from both.
Double Restaking is just one of the many innovations that Double brings to the crypto community, solves real problems cleverly, and adds true fundamental values to both projects and token holders. If you are a token project, reach out to us for integration. If you are a token holder, use Double directly or ask your beloved token projects to integrate with Double so you can double staking. Let’s Double-To-Win!
