This introductory lesson is a brief review of a concept called, ‘rebasing.’ The term rebase has a few different meanings but in the context of crypto protocols, it refers to the system that provides investors with rewards for staking native tokens, ABI in the case of Abachi.
How to stake ABI?
To stake your ABI, simply enter our dAPP protocol and click on the ‘stake’ tab shown in the image below. Once you approve and stake your ABI tokens, they will become sABI and generate rewards via the ‘rebase’ system.
So what exactly is a ‘rebase?’
A rebase is an adjustment to the total supply of ABI tokens that happens approximately every 8 hours. This adjustment happens at the protocol level and increases the total supply of ABI by the currently denominated APY. The new supply of ABIs are then automatically distributed to investors in the form of staked ABI (sABI). This creates a compounding effect that continually grows the amount of sABI held by stakers.
Staking reward calculations are based off of the following data:
- The amount of tokens that you have staked within the protocol (as a percentage of the total)
- The current interest rates or APY offered by the protocol. (eg. ROI 5-day rate)
During each rebase, the system automatically performs the calculations, adjusts the total supply of ABI and distributes the tokens which are automatically added to your balance of sABI. This process repeats with every rebase, compounding your rewards on an 8 hour cycle.
What is the ‘ROI 5-day rate’?
ROI stands for, Return on Investment. The ‘ROI 5-day rate’ represents the amount of sABI rewards that you can expect to earn over a given five day period. This figure is illustrative as the reward rate may fluctuate before any rolling 5 day period completes.
*Disclaimer: ROI isn’t so much a return on investment as it is the apr/apy multiplication of your tokens. (Credit: LanguidBench)
Further explanations in regards to ROI, APY and ‘Next reward yield’ calculations will be available in future units within the Abachi Academy. Thank you for taking the time to learn with us, and we will see you in the next tutorial; What is gABI!