With the launch of our Degenbox, Abracadabra can now enhance the yield on interest-bearing collaterals on all the chains it is on! Let’s see how this applies to Binance Smart Chain with out $CAKE strategy!
The Strategy
Let’s dive into our Degenbox Strategy on BSC, how it works and how our users can benefit from it! Before starting, make sure to read how Abracadabra Lending Markets and Leveraged Positions work here.
**Step 1: The Cauldron
**Users join the CAKE market either simply depositing collaterals or leveraging their CAKE positions! No matter what they choose, as long as they have an CAKE balance deposited, they will receive rewards from the strategy!
**Step 2: Degenbox
**As the CAKE cauldron is built on top of Degenbox, Abracadabra can use the user’s deposited CAKE to produce yield. For this strategy, we are staking CAKE on Pancake Swap for SYRUP tokens. SYRUP tokens are increasing in value over time, as they are incentivised with CAKE emissions.
**Step 3: Distributing Rewards
**Once an harvest is triggered, SYRUP tokens are unstaked and the farmed CAKE are then redistributed to every Abracadabra user of the cauldron, proportionally to their deposited amount! Note that a 10% cut is taken as a management fee, and treated as protocol revenue (i.e used in sSPELL buybacks)!
And just like this, our CAKE strategy is now live!
The best thing about it is that there is no need to migrate your collateral. If you had a position already open in that market, you are already earning CAKE rewards!
Note that from now on, users will see their CAKE collateral increase in quantity, not only in value!
Withdrawing CAKE tokens
Our strategies keep approximately 85% of the CAKE in staked as SYRUP and then in Pancake Swap farming contracts, and 15% in Degenbox to allow users to withdraw smoothly! As a consequence, the amount withdrawable is limited.
Once this limits approaches zero, new CAKE are unstaked and withdrawals are again available!
You can check the amount Available to be withdrawn in the “My Open Position” box, under “Withdrawable Amount”