Staking

Staking lets you earn BCH yield by depositing PUSD into the Stability Pool. The pool plays a critical role in the protocol: it absorbs bad debt when undercollateralized loans are liquidated. In return, stakers earn a share of protocol revenue.

How staking works#

1. You deposit PUSD into the Stability Pool
2. Your stake earns yield from two sources: borrower interest payments and liquidation profits
3. Yield accrues in BCH and can be claimed after each epoch
4. Your stake is locked until the next epoch boundary (up to 10 days) before it can be withdrawn

Your stake is represented as a staking receipt NFT (CashToken) in your wallet. The staking receipt is the only way to access your stake: you need it to claim payouts, withdraw your staked PUSD, and track your position.

In wallets that support BCMR parsable metadata, the staking receipt displays its live state (staked amount, epoch, unclaimed payouts) directly on the NFT. Cashonize and Selene currently support this; see Wallet Compatibility for the full status.

Minimum stake amount: 100 PUSD.

What you earn#

Staking yield is real and sustainable. It’s paid directly by borrowers in BCH through interest payments and liquidation fees, not funded by token inflation or speculation.

Stakers earn BCH from two sources:

Interest payments (70%): borrowers pay interest on their loans. 70% of all interest collected goes to stakers, distributed proportionally based on each staker’s share of the total pool.

Liquidation profits: when a loan is liquidated, the Stability Pool’s PUSD is used to repay the debt, and the pool receives the loan’s BCH collateral. Since loans are liquidated at 110% collateral ratio, the BCH received is worth more than the PUSD spent, and the difference is profit for stakers.

APY#

The app shows an estimated APY based on the previous epoch’s returns, annualized. This is a backward-looking metric; actual yield varies depending on:

• How much PUSD is borrowed (more borrowing = more interest)
• What interest rates borrowers are paying (higher rates = more yield)
• How many liquidations occur (liquidations convert some of your PUSD into BCH at a favorable rate)
• How much PUSD is staked in the pool (larger pool = your share is smaller)

APY is not fixed or guaranteed. It reflects what stakers earned in the last epoch, not what they will earn in the next one. However, the pool is self-balancing: when fewer people stake, each staker’s share of yield increases, which naturally attracts more capital and keeps the pool well-funded for liquidations.

Epochs and lock periods#

The Stability Pool operates in epochs of roughly 10 days. Epochs determine when payouts are distributed and when you can withdraw.

Lock period: when you stake, your PUSD is locked until the next epoch boundary. You cannot withdraw before then. Once unlocked, you can withdraw at any time.

Payouts: at the end of each epoch, earned BCH is made available for claiming. You claim payouts separately from your staked PUSD; claiming does not affect your stake.

Example timeline#

Say each epoch is 10 days long, and you stake on day 2 of the current epoch:

• Your PUSD unlocks 8 days later, when that epoch ends
• Your first BCH payout is claimable 18 days after staking, at the end of the following epoch

If you stake on day 9 of the epoch instead:

• Your PUSD unlocks 1 day later
• Your first payout is claimable 11 days after staking

In general: lock time is 0–10 days (depending on when you stake within an epoch), and time to first payout is 10–20 days. The earlier in an epoch you stake, the longer both waits will be.

Claiming payouts#

After each epoch, you can claim your BCH earnings from the stake detail page. Each epoch produces a separate payout that must be claimed individually. Unclaimed payouts remain available indefinitely; there’s no deadline to claim them.

Claiming currently requires approving one wallet transaction per epoch. If you let many epochs accumulate before claiming, expect to approve that many transactions in a row.

Withdrawing your stake#

Once your stake is unlocked (after the epoch boundary), you can withdraw your PUSD at any time. Withdrawing returns your remaining staked PUSD (reduced by your share of any liquidations that already happened this epoch) along with a pro-rata share of any BCH the pool has earned so far this epoch (interest forwarded from closed periods plus liquidation earnings).

Your stake earns yield only while it sits in the pool, available to absorb liquidations. After withdrawal it stops earning, but it’s also no longer at risk of being reduced by new liquidations.

Withdrawals are always full: the entire remaining staked amount for that receipt is returned. Partial withdrawals are not supported.

Reducing your position#

To reduce your stake, withdraw fully and restake only the portion you want to keep (subject to the 100 PUSD minimum stake).

It’s best to do this near the end of the current epoch. By then most of the epoch’s interest has already been forwarded into the pool, so your withdrawal captures it. And since a fresh stake’s receipt is dated to the next epoch, restaking just before the boundary means your new stake starts earning as soon as the new epoch begins, with no idle epoch in between.

Risks#

PUSD balance reduction#

This is the key risk of staking. When a loan is liquidated, PUSD from the Stability Pool is used to cover the debt. This means your staked PUSD balance may decrease.

However, you are compensated with the liquidated loan’s BCH collateral. Since liquidations happen at 110% collateral ratio, you receive BCH worth more than the PUSD you lost. In dollar terms, you come out ahead, but your position shifts from PUSD to BCH.

Example: A loan with 100 PUSD debt and 0.25 BCH collateral (worth $110 at liquidation) is liquidated. The pool spends 100 PUSD and receives 0.25 BCH. If your share of the pool is 10%, you lose 10 PUSD but gain 0.025 BCH (worth $11). Net gain: $1 in dollar terms, but you now hold more BCH and less PUSD.

In practice, this matters most during sharp BCH price drops when many loans are liquidated at once. If BCH continues to fall after you receive the collateral, the BCH compensation may end up worth less than the PUSD you lost.

Lock period#

Your stake is locked until the next epoch boundary (at most 10 days). The exact lockup and time to your first BCH payout are shown when you create the stake. Don’t stake PUSD you may need within that window.

Variable yield#

Yield is not guaranteed. In periods of low borrowing activity or few liquidations, returns may be minimal. The APY shown is an estimate based on past performance.