Staking

What is Staking

Staking is the primary value accrual strategy of DaoWaBunga. Stakers stake their DAWA on the DaoWaBunga website to earn rebase rewards. The rebase rewards come from the proceeds from bond sales, and can vary based on the number of DAWA 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 DAWA translates into a constantly falling cost basis converging on zero. This means even if the market price of DAWA drops below your initial purchase price, given a long enough staking period, the increase in your staked DAWA balance should eventually outpace the fall in price.

When you stake, you lock DAWA and receive an equal amount of sDAWA . Your sDAWA balance rebases up automatically at the end of every epoch. sDAWA is transferable and therefore composable with other DeFi protocols.

When you unstake, you burn sDAWA and receive an equal amount of DAWA . 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 DAWA (if any) will continue to receive rebase rewards.