4. Staking and Farming
4.1 Tool Analysis
STON Staking
A user locks STON in a smart contract for a selected term, and rewards are distributed over the specified period. When staking, two derivative tokens are issued:
ARKENSTON — a soulbound NFT minted 1:1 to the staked STON. It grants access to DAO voting rights and is burned at the end of staking to redeem the original STON.
GEMSTON — a liquid “engagement” token, also issued 1:1. Its further mechanics are determined by DAO decisions. A calculator for projected GEMSTON rewards is available in the Stake tab.
Pros:
Governance participation (via ARKENSTON).
Predictable reward logic depending on the chosen staking term.
Cons/Risks:
Lock-up and opportunity cost during volatile market movements.
Market uncertainty regarding GEMSTON’s value (set by DAO decisions).
Program nuance: The DAO staked 20M STON from its Treasury for 24 months. This lock-up aligns incentives and makes emissions more disciplined.
Farming (LP Staking)
First, liquidity is deposited into a pool (yielding LP tokens). Then, LP tokens are locked in a “farm” for a limited period, generating additional rewards beyond the share of trading fees. Active farms are marked in the interface; rewards are distributed until the campaign ends or LP tokens are withdrawn.
Pros:
Two income channels: pool trading fees + farming incentives.
Flexibility in choosing trading pairs according to risk profile (including stablecoin pairs).
Cons/Risks:
Impermanent loss.
Dependence of yield on trading volume and campaign duration.
Smart contract risks.
Which Instrument to Choose
Need governance role and exposure only to STON → staking (ARKENSTON for voting + GEMSTON as a bonus).
Need cash flow from fees and higher APY → farming in large pools with solid volume; to reduce impermanent loss, use stablecoin pairs.
Note: farming is time-limited, while staking involves lock-ups. When choosing terms, portfolio liquidity must be considered.
What Enhances Yield and Sustainability
The Omniston aggregator increases flow through pools by routing across multiple liquidity sources, potentially boosting fee income for LPs.
STON.fi educational and campaign materials (guides/blog) help users design strategies (e.g., stablecoin farming, core pool metrics like TVL/volume/APR).
Key Metrics to Monitor
For staking: share of STON locked, lock-up durations, DAO decisions on GEMSTON/ARKENSTON rights.
For farming: pool trading volume and TVL, farm closing date, APR (with and without compounding), potential impermanent loss.
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