Understanding The ADX Loyalty Pool and Elastic Issuance

Recently we announced the release of the AdEx Loyalty staking pool. It uses a Chainlink-powered ADX-USD price oracle for a novel DeFi concept we call elastic issuance. In this post we explain in more details how this pool works, what is elastic issuance and why it matters.

What is the AdEx Loyalty Pool

During the past few months, we brought our staking ecosystem to an entirely new level. We started off with a single validator pool — Validator Tom — and started looking into adding more pools based on popular demand by our stakers and community members.

We received very positive feedback about our staking, and decided to go ahead with the next pool: the AdEx Loyalty Pool.

This pool has a few noteworthy peculiarities:

  • It has no lockup period: you can deposit/withdraw from it instantly at any time.
  • Rewards are automatically added (re-staked) towards the pool.
  • There is no slashing in this pool so there is no way you lose any of your tokens.
  • The pool wraps ADX tokens and generates new tokens: ADX-LOYALTY. These are tradable!
  • Staking in the loyalty pool allows stakers governance.
  • The annual percentage yield (APY) of the pool varies based on the price of ADX — so it’s predictable. More on this further in this article.

The ADX-LOYALTY Pool Token

Unlike our regular validator pools, the loyalty pool is tokenized. This means it wraps ADX in its own token (ADX-LOYALTY) that can be transferred, traded, locked for governance or otherwise interacted with, to take advantage of the vibrant DeFi ecosystem on Ethereum.

This token is essentially an interest-bearing ADX derivative, like the Yearn Finance vault system for example.

When an ADX holders deposit their earnings to the Loyalty Pool, they will receive ADX-LOYALTY tokens....

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To keep reading, please go to the original article at:
The AdEx Blog - Medium

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