Staking

Lodestar Finance's Staking module

Staking on Lodestar Finance allows users to lock their $LODE tokens into a staking contract. By staking their tokens, users gain staking power, which allows them to earn a portion of the protocol's revenues and influence the protocol’s emissions through a weekly gauge.

Optional locking

As part of Lodestar's staking module, users have the option to lock their tokens to earn additional staking power.

By choosing to lock their tokens for 3 months, users can increase their staking power by a factor of 1.4x.

For a 6-month lock, the staking power is doubled (2x multiplier).

It's important to note that this action is optional, and users can still participate in staking without locking their tokens.

Relocking Multiplier

Beyond the initial lock-in period, users can choose to relock their tokens at the end of an epoch to earn a further multiplier on their staking power.

The multiplier gained from relocking depends on the duration of the relock period:

• Relocking 3 months grants a 0.05x multiplier

• Relocking 6 months grants a 0.1x multiplier

These multipliers compound over time, meaning users who consistently relock their tokens, especially over 6 months, can accumulate significant staking power overtime.

It is important to note that the relocking multiplier and your lock time are not the same thing. The lock time determines whether your rewards are earned at 1.4x or 2x. The relock multiplier is in addition to rewarded for consistent relocks on top of the multiplier for lock time.

For example:

• If a user locks for 6 months and then chooses to relock for 3 months, their total boost would be 1.45x (1.4 from lock time + .05 from relocking multiplier)

• If a user locks for 3 months and then chooses to relock for 6 months, their total boost would be 2.1x (2 from lock time + .1 from relocking multiplier)

• If a user locks for 6 months and then chooses to relock for 3 months, and then relocks again later for 6 months their total boost would be 2.15x (2 from lock time + .05 from the first relocking multiplier and .1 from the second relocking multiplier)

Staking esLODE

Users who were affected by the December 2022 exploit will be able to claim esLODE. esLODE can be staked to earn protocol revenue and converted to LODE linearly over a period of 1 year. Once you stake esLODE it CANNOT BE UNSTAKED. If you are interested in trying to make OTC deals on esLODE tokens, you must do this before you stake, once you have staked, it will be too late.

Once esLODE is converted into LODE it will be added to your staking balance. If your LODE is locked for 3 or 6 months, your converted LODE will also benefit from the locking bonuses, but it will also be locked for the remainder of your lock period. Some users may choose to lock for 6 months on 1 account and stake esLODE on a different account, so that their converted LODE tokens will be liquid immediately.

Revenue sharing

Each Sunday, a contract collects 70% of the reserves that have been accumulated over the past week (https://docs.lodestarfinance.io/documentation/technical-overview/reserves/rake). In addition to revenue generated on the markets, the looper service fee (25bps) will also be added to reserves and raked on a weekly cadence.

These reserves are then converted to Wrapped Ethereum (WETH) and distributed proportionally to all $LODE stakers staking power over the following week linearly.