What is Staking
Staking is the primary value accrual strategy of ZeusDao. Stakers stake their $ZEUS tokens to earn rebase rewards. The rebase rewards come from the proceed from bond sales, and can vary based on the number of $ZEUS staked in the protocol and the reward rate set by monetary policy.
Staking is a passive, long-term strategy. The increase in your stake of $ZEUS translates into a constantly falling cost basis converging on zero. This means even if the market price of $ZEUS drops below your initial purchase price, given a long enough staking period, the increase in your staked $ZEUS balance should eventually outpace the fall in price.
When you stake, you lock $ZEUS and Your $ZEUS balance rebases up automatically at the end of every epoch.
Unstaking means the user will forfeit the upcoming rebase reward. Note that the forfeited reward is only applicable to the unstaked amount; the remaining staked $ZEUS (if any) will continue to receive rebase rewards.
What is minting?
Minting is the secondary value accrual strategy of ZeusDao. When users mint $ZEUS tokens, they are actually selling their assets in order to buy a bond from the protocol. Minting Actions are a cross between a fixed income product, a futures contract, and an option. The protocol quotes the minter with terms for a trade at a future date. These terms include a predefined amount of $ZEUS the minter will mint and the time when vesting is complete. The bond becomes redeemable as it vests. I.e. in a 5-day term, after 2 days into the term 40% of the rewards can be claimed.
Minting is an active, short-term strategy. The price discovery mechanism of the secondary bond market renders mints discounts more or less unpredictable. Therefore minting is considered a more active investment strategy that has to be monitored constantly in order to be more profitable as compared to staking.
Allowing users to purchases bonds thorugh Minting allows ZeusDao to accumulate its own liquidity. We call our own liquidity POL. More POL ensures there is always locked exit liquidity in our trading pools to facilitate market operations and protect token holders. Since ZeusDao becomes its own market, on top of additional certainty for $ZEUS investors, the protocol accrues more and more revenue from LP rewards bolstering our treasury.
