Liquidity mining on SushiSwap with wstETH/DAI

in Lido by Lido

In light of the recent proposal, SushiSwap has joined forces with Lido to launch their wstETH/DAI liquidity pool with liquidity mining incentives. This recent implementation allows users to have access to more forms of stETH liquidity as well as improving the efficiency and interconnectivity of protocol integrations.

SushiSwap is an AMM (automated market maker) based decentralised exchange that allows users to swap between various asset classes and also allows liquidity providers to earn fees by providing liquidity to pools.

Users can provide wstETH (wrapped stETH) as liquidity to the respective pool to earn trading fees and additional incentives.

The pool will be allocated 200,000 LDO for the first month, with up to 13,500 SUSHI allocated from SushiSwap as well.

The wstETH/DAI pool is live here.

The wstETH/DAI reward farm is live here.

 

 

How to wrap stETH for wstETH

Users who hold stETH will need to wrap their stETH to wstETH beforehand to interact with SushiSwap. wstETH is a non-rebasing token that remains stable instead of changing daily to reflect staking rewards - staking rewards are only actualised when wstETH is unwrapped.

  1. Head over to Wrap.
  2. Connect your wallet at the top right.
  3. Input the amount of stETH you would like to wrap to wstETH.
  4. Select “Unlock token to wrap” and approve the transaction.
  5. Confirm the final transactions.

 

How to provide wstETH liquidity

Now that you have wstETH, you can provide it as liquidity to earn liquidity mining rewards and trading fees.

  1. Head over to the wstETH/DAI liquidity pool.
  2. Select the “+” button.
  3. Input the amount of wstETH/DAI which you would like to add to the liquidity pool.
  4. Select “Supply”.
  5. Select “Confirm Supply”.
  6. Approve and confirm the transactions in your Ethereum wallet.

 

How to remove wstETH liquidity

  1. Visit the wstETH/DAI liquidity pair.
  2. Select “- Liquidity”.
  3. Input the amount you would like to remove from the liquidity pool.
  4. Select “Remove” and confirm the transactions.

 

Staking wstETH/DAI pool tokens for liquidity mining rewards

After providing wstETH/DAI liquidity to the pool, users will receive an LP token representing their share of the pool. Users will need to stake this token to earn liquidity mining rewards.

  1. Visit Farms and find the wstETH/DAI liquidity pool.
  2. Select the pool.
  3. On the left hand side, Input the amount of tokens you have in your wallet.
  4. Select “Stake”.
  5. Approve and confirm the transactions.
  6. Upon confirmation, you will now start receiving SUSHI and LDO rewards.

 

Unstaking wstETH/DAI pool tokens

  1. To unstake, visit Farms and find the wstETH/DAI liquidity pool.
  2. Select the pool.
  3. On the right hand side, input the amount of tokens you would like to unstake.
  4. Select “Unstake”.
  5. Approve and confirm the transactions.
  6. Upon confirmation, you will no longer be receiving SUSHI and LDO rewards.

 

Claiming SUSHI + LDO liquidity mining reward

More information on the specific reward claiming process will be added here as claiming is enabled.

 

Moving Forwards

With wstETH now added onto SushiSwap, this allows for more interconnected integrations with other protocols. This also allows for the expansion of stETH liquidity to not originate on only one platform (Curve). We hope to see more integrations in the future to make stETH a staple in the liquid staking ecosystem and to increase the liquidity of stETH.