Earning $KWENTA
0xC065
December 19th, 2022

With the launch of the $KWENTA token, stakers will now earn $KWENTA token rewards for both staking and trading. Holders of liquid $KWENTA tokens may also have the opportunity to earn incentives as liquidity providers. All these opportunities are now accessible from your Kwenta dashboard alongside other features available on the Kwenta exchange. Let’s dive in and learn how to stake, how to claim, and how to earn.

The Kwenta exchange, staking, and the $KWENTA token all live on Optimism L2. If you have never used Kwenta or Optimism before you may need to bridge your assets to the network. For more help getting started, come visit us in Discord.

Acquiring $KWENTA

Although there are many different ways to get your first $KWENTA tokens, or build your staking position, the fastest way to start earning is to purchase $KWENTA on the open market. Conveniently, the best liquidity for the $KWENTA token is available right on Kwenta under Exchange.

SynthSwap finds you the best price on any synth or erc20 swap
SynthSwap finds you the best price on any synth or erc20 swap

Aside from purchasing liquid tokens from an exchange, you may be able to acquire either escrowed or liquid tokens from trading competitions, compensated DAO roles, bounties, or similar opportunities. Once you have your tokens, it’s time to stake.

Staking $KWENTA

Since there is currently no cool down period for unstaking and no market exposure or additional risk from staking your tokens, it’s best to keep all your tokens staked unless you’re preparing to sell or transfer your $KWENTA.

Under the current system, you must stake some amount of $KWENTA to earn rewards from trading. Both liquid and escrowed $KWENTA will earn rewards at the same rate, but must be staked separately.

To stake any unstaked $KWENTA, first locate your tokens in the Staking UI.

Liquid $KWENTA can be found under “Staking”, and escrowed $KWENTA can be found under “Escrow”. You may have a balance available in both tabs.
Liquid $KWENTA can be found under “Staking”, and escrowed $KWENTA can be found under “Escrow”. You may have a balance available in both tabs.

Although it’s possible to fill in a custom amount to stake, most users will want to stake their entire amount. To fill in the entire amount, simply click on the balance, and hit “Stake”.

Most users will want to stake their entire balance
Most users will want to stake their entire balance

Congratulations! You’re now earning escrowed $KWENTA tokens from staking rewards. Please be aware that all staking and trading rewards follow the same escrow schedule, which will be covered later in this guide. For more detailed information about the staking page, see the Kwenta documentation.

Now that we’re staking $KWENTA and earning staking rewards, let’s juice our rewards through trading.

Earning Trading Rewards

Kwenta stakers are eligible for a share of 5% of all inflationary rewards, which are earned by paying trading fees. To become eligible for a share of these rewards, users must:

  • Have any amount of $KWENTA staked

  • Place a trade from a Kwenta Cross Margin Account

That’s it! If both of these conditions are met before the end of each epoch, you’ll be eligible for trading rewards.

Claiming Trading Rewards

Trading rewards are calculated and become claimable at the end of each epoch. The epoch countdown clock resets each week when rewards become claimable. After each epoch ends, you can continue trading to earn rewards for the next epoch.

To see your current qualifying fees paid during the epoch, navigate to the “Trading Rewards” section of the Staking UI.

Check here for an estimated reward, which changes as trades are made
Check here for an estimated reward, which changes as trades are made

Total rewards are decided at the end of each epoch based on a traders rewards score. The rewards score increases as more $KWENTA is staked, and as more trading fees are paid, according to the formula below:

Fees and staked $KWENTA are weighted with a configurable value, currently set at 0.7, adding extra weight to trading fees paid.
Fees and staked $KWENTA are weighted with a configurable value, currently set at 0.7, adding extra weight to trading fees paid.

Once the epoch is complete, trading rewards will appear as claimable on the left side of the trading rewards page. Once the epoch ends, these rewards will keep accumulating until claimed. These rewards, like other staking rewards, are claimed as escrowed rewards and follow the same unlocking schedule. Remember to stake your rewards after you claim!

These rewards to not expire, but do not begin vesting until claimed.
These rewards to not expire, but do not begin vesting until claimed.

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