¶ Earning Yield on Ergo
Ergo is a Proof of Work (PoW) blockchain, which means it doesn’t support staking like Proof of Stake (PoS) blockchains. However, you can still earn yield on your ERG holdings by participating in liquidity pools, dApp tokenization, trading bots, lending platforms, and other innovative mechanisms.
¶ Centralized Exchange Offerings
| Opportunity | Type | Platform / Project | Status | Description |
|---|---|---|---|---|
| KuCoin Grid Bots | Trading Bot | KuCoin | Live | Grid trading bot for buying and selling |
| CoinEx AMM Pool | Exchange, LP | CoinEx | Live | Liquidity providing in AMM pool |
| Swop.fi AMM Pool | Exchange, LP | Swop.fi | Live | Liquidity providing in AMM pool |
| Gate.io Lending | Exchange, Lending | Gate.io | Live | Lending assets for interest |
| Huobi Trading Bots | Trading Bot | Huobi | Live | Various trading bots for automation |
| Custom Bots | Trading Bot | shrimpy.io, 3commas | Live | Custom trading bot solutions |
| Huobi Earn | Short-term Offer | Huobi Earn | Live | Interest-earning on deposits |
| Low-Liquidity Exchanges | Long-term Offer | SevenSeas, TradeOgre, etc | Live | Profit off exchanges with low liquidity by acting as a Market Maker |
¶ Ergo Ecosystem Projects
Financial Instruments
| Type | Platform / Project | Status | Description | Resources |
|---|---|---|---|---|
| Lending | Duckpools | Live | Lending pools and collateralized loans | Video Guides |
| Bonds | SigmaFi | Live | P2P-focused financial services platform | Video Guide |
| Options | SigmaO | Public Beta | Options trading on Ergo | Demo |
| P2P Lending | EXLE | Public Beta | P2P lending platform |
Yield
| Type | Platform / Project | Status | Description | Resources |
|---|---|---|---|---|
| AMM, LP | Spectrum | Live | Decentralized exchange and LP | Video Guide |
| Farming | Spectrum Finance | Live | Farm tokens on your LPs | Video Guide |
| LP | SigmaUSD on Spectrum | Live | Unique LP opportunities with SigmaUSD |
Staking
| Type | Platform / Project | Status | Description | Resources |
|---|---|---|---|---|
| Staking | ErgoPad | Live | Staking platform for ERG and other tokens | YouTube |
| Staking | anetaBTC | Live | Staking platform for ERG and BTC | |
| Staking | Auction House | Live | Claim a share of the site’s profits by staking AHT |
Tooling
| Type | Platform / Project | Status | Description | Resources |
|---|---|---|---|---|
| Grid Trading | Off-the-grid | Available | Decentralized grid trading bots | |
| Off-Chain Bots | Spectrum Finance | Live | Earn fees for matching orders | Video Guide |
| Off-Chain Bots | Duckpools | Live | Earn fees for matching orders | |
| Grid Trading | Machina Finance | In Development | grid trading DEX |
Degen
| Type | Platform / Project | Status | Description | Resources |
|---|---|---|---|---|
| Short/Long* | SigmaUSD | Live | Secure stability or bet on utilisation. | Buying Guide |
| Degen | Hodlcoin | Live | A Transparent Ponzi | Concept Video |
| Degen | Hodlbox | Live | Lock your ERG until $20 | docs, interview |
| Degen | Auction Coin | Live | A Transparent Ponzi | |
| Gambling | Grand Gambit | Live | (Centralised) Gambling Platform | |
| Degen | Options Coin | R&D |
Inactive
| Type | Platform / Project | Status | Description |
|---|---|---|---|
| Staking | NightOwl | Planned | Staking platform for ERG and other assets |
| Index | Ergo Index | Inactive | Early ERGOHACK project, code may be useful |
Please note that the information in these tables may change as projects and platforms evolve. Always do your own research and stay updated on the latest developments before making any investment decisions.
Discuss with the community
¶ Spectrum
There is currently one decentralized exchange on Ergo, Spectrum. There are several pools on Spectrum with a visible estimated asset annual percentage yield (APY) that can be used for yield harvesting.
Your redeemable amount changes as the pool gets used and a percentage of the swaps are earned by the pool. You get a percent of the pool fee proportional to your stake.
- SigRSV/ERG pair
- Minimises impermanent loss (both coins move in the same direction price-wise)
- SigUSD/ERG
- High IL risk, however a solid investment if you want to earn fee’s off your nest-egg. SigUSD has has never came close to loosing it’s peg.
Community
¶ More
In addition to the previously mentioned methods, you can explore other opportunities to generate yield with your Ergo holdings. Check out the Blog: Earning ERG in 2023 and Beyond and here are a few more options:
¶ NFT Marketplace
As the NFT space continues to grow, consider investing in Ergo-based NFTs as a way to potentially generate returns. Look out for emerging NFT marketplaces on the Ergo platform where you can buy, sell, and trade digital art and collectibles.
¶ Governance Tokens
Some Ergo-based projects may issue governance tokens, allowing holders to participate in the decision-making process for platform development. By staking or voting with these tokens, you could potentially earn rewards or gain access to exclusive features and benefits.
¶ Arbitrage Opportunities
Monitor various exchanges and DeFi platforms for price discrepancies in ERG and other tokens. Exploit these arbitrage opportunities to generate profits from the price differences. Be mindful of transaction fees and potential risks when employing this strategy.
¶ Airdrops
Stay up-to-date with the latest developments in the Ergo ecosystem, as new projects may offer airdrops to ERG holders or early adopters. By participating in these airdrops, you can receive free tokens, which could increase in value over time.
¶ Token Sales
Participate in Initial Decentralized Token Offerings (IDOs) on platforms like ErgoPad. By investing early in promising projects, you can potentially benefit from the growth in value of these tokens.
Remember, each investment opportunity carries its own risks, and it’s essential to conduct thorough research before participating. Stay informed about the latest news and updates in the Ergo ecosystem to make well-informed decisions and maximize your potential returns.
¶ Appendix
¶ Ergo Profit-Sharing DApp
This innovative service enables dApps to distribute earnings among their token holders. Initial implementations will tokenize ErgoMixer, followed by Ergo Auction House and Ergo Raffle. ErgoMixer’s revenue, currently received by its creator, will be distributed to $MIX token holders who stake their tokens in the Profit Sharing contract.
So, it will not be way a way to ‘stake’ ERG at first. However in the future it could be used in some creative services to provide ERG-staking.
More details available on the ergoforum.
¶ Technical Analysis Resources
¶ Automated Market Makers (AMMs)
An Automated Market Maker (AMM) uses mathematical models to set the price and match buyers and sellers rather than merely matching buy and sell orders, as in traditional order-books. AMM is best in markets with low liquidity.
One of the features of AMM is that liquidity providers add assets to the exchange for a fee, and the market benefits from an increase in liquidity, smaller latency, limited price slippage, and less market volatility when using this additional liquidity.
Please be aware of impermanent loss.
¶ Impermanent Loss / Volitality Harvesting
Impermanent loss (IL) occurs when the mathematical formula of an AMM adjusts the asset ratio in a pool to ensure both assets remain at an even value.
Example: You enter an AMM pool of Erg/SigUSD, when the prices of each of these assets is at $10 and $1. So, you put in 1 Erg for every $10 SigUSD into the pool.
Then, Erg’s price goes to $20 a month later. Let’s assume you earned $2 in fees. You’ll then have 0.8 Erg and $16 SigUSD to have even amounts in the pool, or $32. The higher the price of Erg relative to SigUSD, the less Erg you have.
So, why would anyone provide liquidity to an AMM in an asset they expected to go up and a stablecoin like SigUSD? The answer: volitality harvesting.
There’s an involved paper, but here’s the central idea: digital assets like Erg don’t just increase. They have a lot of volitality, ups and downs, and if you are in an AMM liquidity pool, the balancing of the AMM of the pool works as a kind of dollar cost averaging. It buys more of the asset that costs less when it is down and less of the asset that costs more when it is up.