Compounding Liquidity Mining Rewards Using QuickSwap
This article will fill any potential knowledge gaps about how liquidity mining rewards can be optimized.
Liquidity mining is a rather straightforward concept, to be sure. However, before getting started, you should carefully consider and assess your goals and expectations, ensure that you have a thorough understanding of the entire DeFi ecosystem, and, most importantly, select a solid and sophisticated protocol that will allow you to maximize liquidity mining processes. Quickswap is my personal favorite; you’ll see why at the end of this article.
Liquidity Mining on Quickswap
A 0.3% fee is charged for swaps performed on Quickswap. Liquidity Providers receive 0.25% of these fees for their pool.
Additionally, you can use your LP tokens to earn dQUICK in addition to the trading fees by staking them in the liquidity mining tab. Because dQUICK is already staked QUICK, your incentive is generating even more income.
It’s worth mentioning that Quickswap selects which pools are incentivized, and changes can occur at any time.
Concrete Example of Compounding
To make the statement (liquidity mining)clearer, let’s examine a hypothetical scenario:
162 $MATIC / 1000 $QUIDD Liquidity is what you’re supplying (at the time of writing, both numbers of tokens had the same dollar value). Simply by taking this action, you will get a share of the 0.25 % of the fees between these pairs.
It doesn’t stop there; you can also earn dQUICK by staking your Lp token in the liquidity mining tab.
Letting rewards accumulate and not doing anything with them is almost never a good idea, as you miss out on potential gains. dQuick is still a viable choice if you don’t have the time to manually complete the steps below because it accumulates more Quick over time.
- You can claim your dQUICK, (decide the frequency; daily, weekly or monthly).
- Unstake the dQUICK to receive $QUICK in the Dragon Lair tab
Dragon’s Lair is a feature that allows $QUICK holders to stake $QUICK in order to earn even more $QUICK.
3. Convert the QUICK(old) to QUICK(new), Be sure to connect your wallet
From QuickSwap’s new beta User Interface, click “Convert”.
Enter the amount of Old QUICK you’d like to convert or press MAX. In the bottom window, you will see how much New QUICK you’ll receive for converting. When you’re ready, click “Approve”. Then confirm it in your wallet. After just a few moments, your Old QUICK will be converted to New QUICK.
You can add the New QUICK Token Contract Address to your wallet if you want to see them, tho not important for this blog;
In the first row, enter New QUICK’s token contract address 0xB56D072b1A0e86ee414eC2Dcca67E84191b0C772. The remaining fields will auto populate. Then click “Add Custom Token”.
You should now see your New QUICK in your wallet.
4. Stake those new $QUICK in $QUIDD syrup to earn $QUIDD.
Dragon’s Syrup is a feature designed to give $QUICK holders the opportunity to generate passive income in a variety of participating tokens. Users stake $QUICK to earn a portion of the rewards token(s) of their choosing
5. Swap half the $QUIDD you got from the Syrup to $MATIC and start over.
Adding Fees to Consideration
Unless you’re using on QuickSwap (which uses Polygon/Matic) or another layer 2 solution with low fees, the number of transactions required to reclaim your incentives, as well as the amount paid in-network and trading fees, is likely to be significant.
For the time being, network fees are essentially non-existent on polygon as I can use one $MATIC (less than 1$) to make over 50 transactions
Mastering the ability to maximize liquidity mining gains could be more profitable than researching new cryptocurrency products and other activities that used to occupy the average crypto trader’s time. Any cryptocurrency enthusiast serious about getting profit should learn how to compound gains, when to sell, and how to save on fees.
QuickSwap is a fork of Uniswap developed by Nick Mudge and Sameep Singhania on the Polygon blockchain platform. QuickSwap is a permission-less decentralized exchange (DEX) based on Ethereum but powered by Polygon’s Layer 2 scalability infrastructure.
QuickSwap has all of the popular features of top DEXs, but it also has the missing key components for a completely smooth user experience. Some important features of QuickSwap include:
- Community Governance
- Liquidity Mining
- Yield Farming
- Dual Farming
- Layer 2 Transactions
- Non-custodial trading
For More Infomation: