Stake Your KSM on Karura & Earn from 350,000 KAR in Rewards
KSM Liquid Staking has arrived — and to celebrate, Acala is kicking off a two-week liquidity mining program to reward the Karura community with 350,000 KAR. Starting on Tuesday, September 28, anyone can earn from a total of 350,000 KAR in rewards when they stake KSM for LKSM, the yield-bearing liquid KSM staking derivative, or become an LP in the new LKSM/KSM pool.
Read on to learn how you can participate in the KSM Liquid Staking Splash.
Introducing KSM Liquid Staking
Just shy of two months into its launch, Karura has delivered a layer-1 application platform optimized for DeFi, along with a suite of applications for the Kusama ecosystem, including: Karura Swap, the AMM-style DEX for trustless trading and liquidity provider rewards, and kUSD, the multi-collateralized stablecoin soon-to-be-backed by cross-chain assets like BTC and ETH.
Now, Karura introduces a new product that continues to help optimize DeFi earning strategies: KSM Liquid Staking (LKSM) — the unlocked, yield-bearing staking derivative that empowers users to stay liquid while earning their Kusama staking rewards.
KSM Staking, Amplified
As any Kusama supporter knows, staking KSM not only benefits the network by aligning security and consensus through its nominated proof-of-stake architecture, but it also rewards the users with additional KSM. In fact, staking KSM can generate favorable yield for holders; however, up to this point, there have been several challenges:
- Staked KSM is locked and has no utility beyond earning rewards.
- Staking through Polkadot.js requires high staking minimums, along with a seven-day unbonding period.
- Finally, the UX can be frustrating, with many users turning to centralized exchanges that offer a simplified experience but forces the user to forgo the custody of their keys.
Fortunately, a new staking experience is available with Karura’s Liquid KSM (LKSM) staking product.
Stay Liquid While Staking
Liquid KSM (LKSM) allows users to stake their KSM while maintaining access to its liquidity. A game changer in the world of staking, when KSM is staked, users receive LKSM (a tokenized receipt for their stake) with the additional benefit of it being a yield-earning token.
With LKSM’s accessible liquidity, users can make additional use of their stake with other DeFi protocols including Karura’s other products. For example, LKSM can be used as collateral for a kUSD stablecoin loan, for trading within the DEX in an LKSM/kUSD pair, or for becoming a liquidity provider (LP) in the LKSM/KSM pool. One can quickly see how this creates some interesting DeFi use cases.
What’s more, Liquid KSM offers low staking minimums, and no unbonding period for the underlying KSM, since users can unbond at any time for a small fee.
Join the LKSM Liquid Staking Splash
To celebrate the launch of LKSM Liquid Staking, Karura is kicking off a new liquidity mining program to reward the community with 350,000 KAR. The liquidity mining program has two ways to earn:
- Stake KSM for LKSM, and earn by staking your newly minted LKSM
- Stake KSM for LKSM, then provide liquidity for the new LKSM/KSM pair
Starting on Tuesday, September 28th, participants can earn KAR rewards from these two new reward pools. Here’s how to get your rewards:
KAR Reward Pool #1
Stake KSM for LKSM, and earn by staking your newly minted LKSM
Rewards period: 2 weeks
1. Be sure your KSM is unbonded and ready to move to Karura.
Staking KSM on Karura requires transferring KSM from the Kusama Relay Chain to the Karura parachain. Once you have KSM on Karura, you’ll be able to earn staking rewards while accessing its liquidity to compound your yield. If you’re new to transferring KSM to Karura, please see this guide on completing the cross-chain transfer (guide includes transferring from exchanges).
If you already have your KSM on Karura, you’re ready for the next step.
2. Stake your KSM for LKSM & start earning rewards
Simply navigate to the Liquid Staking section on Karura and stake your KSM. In return you’ll receive LKSM, a yield-bearing token representative of your stake. When staking your KSM, select the toggle to “Stake LKSM for Rewards.” Now you will start earning KAR.
Please note: by staking your LKSM, you can now mint kUSD if you choose. You will see this as an option in the “Mint kUSD” tab.
Note: If you’ve already collateralized your LKSM for kUSD prior to the start of this LKSM Splash program, you’ll simply need to stake the LKSM on the Karura “Earn” tab in the “Collateral Staking” section.
You’re now qualified to earn KAR rewards! KAR rewards will continue to be accrued over the course of the rewards period, so long as LKSM is deposited in the stablecoin protocol during the LKSM Splash Event.
KAR Reward Pool #2
Stake KSM for LKSM, then provide liquidity for the new LKSM/KSM pair
Rewards period: 4 months
1. Be sure your KSM is unbonded and ready to move to Karura.
Staking KSM on Karura requires transferring KSM from the Kusama Relay Chain to the Karura parachain. Once you have KSM on Karura, you’ll be able to earn staking rewards while accessing its liquidity to compound your yield. If you’re new to transferring KSM to Karura, please see this guide on completing the cross-chain transfer (guide includes transferring from exchanges).
If you already have your KSM on Karura, you’re ready for the next step.
2. Stake a portion of your KSM for LKSM
For this pool, you will become a liquidity provider (LP) for the LKSM/KSM trading pool, meaning you will need to provide a proportional amount of LKSM and KSM to the pool. Since you need both LKSM and KSM, you will need to stake some of your KSM for LKSM, while saving native KSM for providing to the pool.
Simply navigate to the Liquid Staking section on Karura and stake some of your KSM. In return you’ll receive Liquid KSM (LKSM) — see guide.
3. Provide liquidity to the LKSM/KSM Pool
For this pool, you will become a liquidity provider (LP) for the LKSM/KSM trading pool.
First, navigate to the “Swap” tab and select the “Liquidity” tab at the top.
In the “Add Liquidity” section, select LKSM and KSM as the two tokens. Then, enter the amount of LKSM or KSM you want to provide as liquidity. You will notice that the screen will automatically calculate the amount needed in the other token in order to meet the current pool ratio of LKSM and KSM.
Finally, select “Stake LP Tokens” (required in order to earn rewards on this pair), then click the red “Add Liquidity” button and finalize the transaction.
Congratulations, you are now earning KAR rewards as a LKSM/KSM LP!
Rewards start Tuesday, September 28th
As a reminder, the rewards in the above LKSM Splash liquidity mining program start on Tuesday, September 28th, so get your KSM unbonded and send a cross-chain transfer to Karura to prepare for the start of the program.
Save Your Spot for the Liquid Staking Launch Party!
Want to see LKSM Liquid Staking in action? Join the Acala and Karura team on Crowdcast on Tuesday, September 28 at 9pm UTC for an overview of LKSM and a peek at new, never-before-seen DeFi use cases.
KSM Liquid Staking Launch Party - Crowdcast
Get Ready for the KSM Liquid Staking Splash was originally published in Acala on Medium, where people are continuing the conversation by highlighting and responding to this story.
