The project in today’s feature is Unistake – if you haven’t heard of it yet, it is because it’s still in its infancy and this is also why it’s a great choice for me as I like to have the first mover’s advantage and get in early so I can ride the wave of growth that is inevitable here – being a DeFi project and one that is actually linked to the biggest DEX of them all – Uniswap.
Uniswap is a very popular platform among crypto users, it’s the most used DEX for the past two years and the chances are – you’re either a user already or at least, you’ve heard of it.
It has over a billion dollars in daily trading volume and it’s the ultimate leader for both users who trade tokens on its platform and those who earn dividends by providing liquidity to its markets. However, users on Uniswap are forced to choose between earning rewards through staking, or through joining a liquidity pool!
This where Unistake steps in and changes the game.
Their motto is : “Why not Do Both” – referring to the fact that with this tool you can actually take advantage of staking rewards and at the same time provide liquidity for your chosen projects to earn even more from the fees collected, so in effect, you are taking advantage of both methods of earning passively.
Let’s find out more about this company.
What is Unistake?
This is a decentralized token protocol built to empower DeFi projects and incentivize liquidity providers through staking bonuses, yield farming and regular dividends.
Unistake was founded in early 2020 at the time when Uniswap was already gaining traction, seeing an influx of new projects, all of which needed liquidity and this became the main advantage of Unistake.
So what made them positioned so perfectly for such an advantage?
The platform is a liquidity platform designed to solve many of the risks and difficulties associated with the world of DeFi providing and attracting liquidity to a project.
Unistake is a decentralized app (dApp) built and deployed on the Ethereum blockchain to work specifically with the Uniswap decentralised exchange. Their immutable smart contracts work in conjunction with the Unistake website. The smart contracts are open source and they’re audited by security experts which is a very important point to make as this gives users certainty that the smart contract will perform the functions it is programmed to do, and gives them peace of mind that their funds are safe and not in the control of any third party.
Unistake provides a seamless link between the Uniswap exchange and the projects using Unistake to attract liquidity providers. The platform allows users to provide liquidity to Uniswap in their chosen pair without leaving the Unistake website. Liquidity providers can withdraw Staking Bonuses at any time during their term and once the term has ended or they can simply withdraw or even restake their liquidity and Uniswap trading fees.
For projects, Unistake is attractive because All projects want their tokens staked by the users, but also, they want to lock up liquidity.
Through the aspirations of earning more rewards, Unistake allows for projects to attract more Uniswap liquidity providers! Not only that, but through the earning of additional staking rewards, the Unistake platform can motivate users to lockup a project’s tokens for a longer period of time – which should reduce the token supply, and subsequently increase the token’s value…
Why is Liquidity Important?
There are thousands of trading pairs on Uniswap but as we see, not all of them have good liquidity. Liquidity can be a make or break component for any new project.
Liquidity = Value
A token price has no relevance unless there is enough liquidity to back it up. For example, a holder could have 1 million tokens each valued at $1, showing a balance of $1,000,000 in their wallet. But without enough liquidity in the pool, the holder will not be able to realize the value of the token and the actual tangible price could be $0.
I’ve had tokens airdropped to me in the past, that are not being supported by any major exchanges and therefore had little to no liquidity, so I was not able to sell them at all and some of these are still in my wallets long forgotten, never to realize any value at all. This is why Liquidity is a serious issue.
Liquidity = Stability
For tokens listed on Uniswap, a healthy amount of liquidity is what gives the token true value. This is because the more liquidity a token has, the less volatile the price fluctuations will be when swaps are performed. Buying and selling tokens with low liquidity results in huge price changes known as slippage.
Increasing liquidity, limits the amount of slippage, and in turn attracts more traders and creates tangible value to the token.
How Is Unistake Solving The Issues Of Liquidity?
Unistake makes it possible to attract the liquidity that a project needs for its tokens and encourages providers to keep it flowing through customizable lock up periods and time based incentives.
The free tools provided enable projects to easily set up a Unistake pool and accurately predict the amount of liquidity that their chosen pair is likely to receive. Along with the ability to adjust the pool parameters to suit market conditions and your token price, Unistake makes it possible to attract liquidity providers in a precise and deliberate manner instead of relying on them being incentivised by the Uniswap trading fees alone.
The reason people provide liquidity on Uniswap is to receive a share of the trading fees paid by using the protocol to swap tokens. However, there are factors in being a liquidity provider, that can prevent someone from joining your pools, which Unistake was built to help alleviate. These factors are :
Unpredictable Returns: There is no reliable way to be sure of what the returns will be as the trade volume of the token can fluctuate massively based many unpredictable factors and overall market conditions.
Impermanent Loss: Losing value on the tokens provided is a very real possibility especially in new pools with low liquidity.
In conclusion, if a project uses Unistake (as opposed to just Uniswap) then they can have more predictable returns & offset any impairment loss.
Another problem that projects face when seeking liquidity is the difficulty curve a user experiences when trying to provide liquidity.
Often a user would need to have both tokens in a trading pair in order to provide liquidity, and in some cases it might not be worth the effort on the part of the user. For example, say a user wants to support one of their favorite projects by becoming a liquidity provider, but that project’s token is paired with ETH, and this person doesn’t own any ETH…well…then.. typically they would have to go and purchase some ETH in order to provide liquidity to that specific project.
In many cases the rewards are not worth the hassle – especially if users have to choose between staking or liquidity rewards, as Uniswap forces you to choose one or the other.
However, Unistake expedites this process by allowing users to provide liquidity for all projects with just a single token. This way it is easier, simpler, faster and way more efficient.
It is also much more profitable for users to provide liquidity this way because being able to become a liquidity provider regardless of whatever that project’s token pairs are, works hand in hand with the fact that users are also able to earn more rewards.
This is what Uniswap lacks and it’s the key feature of Unistake that I personally like a lot.
It’s called PoolMatch – Compared to providing directly on Uniswap, when using PoolMatch you only need one side of the pair to join the pool. The project can select which side that should be, or they can create duel contracts to attract even more liquidity providers. This wat token holders are able to join pools without the need to hold the same value in ETH and gives ETH holders a great way to join and get involved in tokens that they do not already hold.
I’m not going to go into further details on how this works – if you want to find out more, just head over to unistake.com/poolmatch
Projects can also add their tokens to PoolShares to incentivise people to provide liquidity even if they do not hold any tokens. When using this option 50% of the staking dividends go right back to the project extending the period in which the project can offer staking and PoolShares to their supporters.
All of these features are made possible via the use of smart contracts, which are all audited and you can find these audits uploaded on their website.
And last but not least is the importance of the Community support.
The most successful project are the ones that have a loyal and active community – you’ve heard me say this many times when I review crypto projects on this channel and Unistake has achieved a lot in this regard.
One of the earliest use cases that indicates a strong community solidarity was a voting poll launched in Mid-September held with the purpose of approving or denying a proposal regarding their tokenomics.
The vote was unanimous, with 117 votes FOR and 0 votes AGAINST!
The next big achievement came in the form of Unistake’s Initial Stake Offerings (ISO).
Rounds 1 & 2 saw 2000 ETH worth of sales in just about 6 Hours while ROUND 3 SOLD OUT WITHIN 40 min. This is outstanding performance that took everyone by surprise as the team was prepared to keep their ISO running for up to a year and in effect, it finished in less than an hour.
This is how I know that we’re looking at a project that is about to blow up and why I told you that this is one of the best projects I have reviewed in a while.
The token is already traded on Uniswap of course but it is designed in a way that incentivises users to HODL – they implemented a staking reward system from the start.
The total supply is 280 million tokens. It is an ERC20 token like the majority of the DeFi tokens and The ISO contract automatically staked all tokens purchased by participants and incentiviszd them not to withdraw them while the platform was being developed. Participants could withdraw them at any time during the initial development phase which was set to 180 days; however, if they did so, they would lose the total amount of tokens they could have received if they waited the entire term. Through Staking Bonuses, people who waited the full 180 days received 100% more tokens than participants who withdrew early. This is a great way to secure less supply or in other words – create scarcity, which is great for the token hodlers as it also brings the value up and we see that the price of the token has appreciated quite a lot since its launch a few months ago.
Another feature intended to encourage token hodling, is that active ISO stakes holders are automatically included in a share of staking dividends. These dividends are instantly allocated to active stakers from the staking bonuses that were forfeited by a supporter withdrawing their tokens from the ISO. The percentage of dividends each supporter receives is proportional to the amount of tokens they have staked.
It is also a deflationary token and its supply will be reduced through token burn functions. Burning forfeited staking bonuses continues throughout the life of the project every time a stake is ended early.
In regards to the utility of the token: Any project can utilize the tools offered to attract the liquidity they need, and anyone looking to provide liquidity can increase their returns by using the Unistake token to join those pools. To take advantage of these benefits, projects and liquidity providers both require the Unistaketoken (UNISTAKE) to do so. In order to use Unistake to attract liquidity providers, projects will need to have a Uniswap pair with their token and UNISTAKE.
You can find out more about the tokenomics on Unistake.finance
In a nutshell:
Defi offers various opportunities for investors wanting to get behind their favorite projects. One of the most popular ways to get involved is by joining liquidity pools to earn trading fees through the Uniswap decentralized exchange.
Another popular and profitable option is through staking which is the act of locking aside tokens for a period of time for a steady return, both of these options are great ways to increase your token holdings, but the question has always been which one to choose. Well, with Unistake you can do both – you can join the Uniswap liquidity pools, earn rewards for being a liquidity provider while simultaneously getting staking rewards too. You can use multi-stake to provide liquidity to three tokens at the same time and receive two sets of trading fee revenues; up to three lots of dividends from staking and a share of all revenues derived from the unistake platform; enter traditional uniswap liquidity pools with two tokens, but with the added bonus of predictable returns from staking or join liquidity pools easier than ever before with pool share; Also – you can provide liquidity with only one token and share trading fee profits with other users who have the tokens.
Unistake makes it easier for projects to gain liquidity – which in turn should lead to more healthy & sustainable projects.
And with 2021 being the year of DeFi (again) we will certainly see Unistake grow and flourish in the months to come.
The platform is due an official launch later this month so join their community to find out when – the links are in the description below.
And this is not all – Sushistake is the next obvious branchout as Sushiswap is also gaining traction and could one day surpass Uniswap in popularity and TVL. This is still in the making, but I’m sure we will see this happening soon.