Staking

Step-by-Step Guide to Oiler’s Drilling Expedition, a staking program on Uniswap

Staking available at:

https://staking.oiler.network/

For the step-by-step guide to Staking, please visit:

https://medium.com/oiler-network/oilers-drilling-expedition-de1544a21582

Drilling Expedition (Staking formulas)

The principle of the Drilling Expedition event is to add and lock liquidity for some amount of time, while getting a reward after the Expedition ends.

Uniswap LPs

Uniswap is an AMM pool where anyone can swap OIL for USDC. Pool has some liquidity added from Oiler LBP already, but anyone can add more liquidity - to earn 0.3% Uniswap fees from trades.

💡 Uniswap help: When you add liquidity, you will receive pool tokens representing your position. These tokens automatically earn fees proportional to your share of the pool (0.3% fees from all the swap), and can be redeemed at any time.

When you add liquidity to OIL<>USDC Uniswap pool - you get LP tokens.

You can use LP Tokens to participate in the OIL Drilling Expedition - by staking them (locking) in the contract for a set amount of time - while earning OIL rewards at the end of the program.

OIL RESERVOIR: 500 000 OIL

Drilling Expedition has a "prize pool" - tokens that will be divided among all participants of the Expedition. The amount of the "prize pool" is 500 000 OILs - that will be divided among participants of the Drilling Expedition based on the proportions of their Extraction Powers to the Total Extraction Power of the whole expedition (of all users).

💡 By default we decide OIL Reservoir to be 500 000 OIL (0.5% of OIL total supply)

Staking & Vesting Timing

Staking Program (Drilling Expedition) duration is 100 days.

After the Staking Program (Drilling Expedition) ends - the rewards are then calculated and locked - and you can jump into that OIL RESERVOIR and split it between all participants, depending on their share of pool (which is a share of total extraction power - explained below)

But you cannot get the tokens straight away when the Staking Program ends - you just get them assigned - and then they are vested for the next 100 days. More on vesting below.

Your Extraction Power: 56 MegaDrills

💡 Extraction Power = (LP tokens you want to stake) * (blocks you stake)^2

Drills are LPs*Blocks^2

Usually Extraction Power is measured in Mega-, Giga-, PetaDrills, etc.

You start the process of Drilling by submitting the stake transaction - this way you commit to not abandon your stake until the specified block. If you do abandon - you're not getting any drills, and just get your stake back - it's like you never staked.

The Process of DRILLing

While you stake your LP tokens - we say you're Drilling.

If you abandon your stake earlier than you committed then you're not getting those GigaDrills.

To get the Drills accounted to your account - you must wait until the end of your stake and then CEMENT the Drills.

CEMENTING the Drill

After the drill has finished - you need to CEMENT it to save your Extraction Power gains.

After Cementing - you will be able to make a new DRILL again to earn more Extraction Power.

But keep in mind that, because of the Extraction formula - it's much profitable to make one long Drill instead of many short ones.

Accumulating Extraction Power

You can have only one active stake (Drill) from one address at a time.

If you want to make a new stake, or add more tokens to the stake - you need to abandon your current Drilling and start a new one (losing all additional extraction power from that particular drill).

When the stake ending block comes - you can Cement the Drill - thus protecting it and saving it to your extraction power.

So, you accumulate the Extraction Power over time - each Cemented Drill accumulates the Extraction Power of your account and this cannot be lost anymore. Only the non-cemented Drill is lost when you abandon it.

That strange number in brackets: 107.27 milliDrills (+195.13 MegaDrills)

That means 107.27 miniDrills from your previous stakes are already accumulated and Cemented on your account - it cannot be lost anymore - it's yours.

And "(+195.13 MegaDrills)" in brackets is your current Drill - this amount will be added to Your Extraction Power when you finish the Drill and Cement it. But you can lose this amount if you abandon it.

Total Extraction Power: 231.85 GigaDrills

Total Extraction power is just a sum of all User Extraction Powers who participate in the Expedition.

💡 This number is not just cemented drills, but all current drills too - so it can go not only up but also down.

Your Harvest Share: 12.3%

This is your share of the pool. Your share of the network. Your share of the DRILLs. And the most important - your current share of the 500 000 OIL reservoir reward pool.

It's calculated as:

💡 Your Share = Your Extraction Power / Total Extraction Power

The slider

When you want to make a stake (to start Drilling) - you can input the amount of LPs into input field, and choose a number of days with a slider.

Days are converted to blocks using an average ~13.1 seconds per block (= 6595.42 blocks per day).

And the info below displays what will you get if you make that particular stake with these particular parameters. And you're getting:

— More Extraction Power: [see Your Extraction Power above].

— This additional Extraction Power will give you more pool share - thus you potentially can harvest more OIL in the end:

Potential additional OIL = More Extraction power / Total Extraction Power * OIL RESERVOIR

Harvest Time - Vesting

After the Staking Program ends - it's Harvest time.

You will be assigned a share of tokens from the Oil Reservoir based on your Harvest share (explained above) - and these tokens are vested for the next 100 days.

What vesting means - is that each block during the next 100 days you can withdraw an equal amount of tokens.

So if you earned and were assigned 132000 OIL tokens from the pool - then during the next 100 days (660000 blocks) - every block what you can withdraw increases by 0.05 OIL.

So after 200 blocks you can withdraw 1 OIL. Then wait 200 blocks and withdraw another 1 OIL. Or you can wait 1000 and get 5 OIL. Or even wait 100 days and withdraw everything all at once.

You can withdraw as many times as you wish - even every block (providing you are ready to pay gas for it).

Legal Notice:

This article and any information contained in it is subject to the Legal Notice and Risk Disclosure Statement. Please carefully review the Legal Notice as it contains important legal information, risk disclosure statement, limitations and restrictions relating to the information that we provide, third-party resources and forward-looking statements.

The Oiler Token Liquidity Bootstrapping Event (the “LBP”) is a healthy token price discovery mechanism employed by Oiler. The LBP is not a token sale nor a token offering, and Oiler does not receive any proceeds from the LBP. Assets contributed to the LBP cannot be redeemed or withdrawn by Oiler. Upon completion of the LBP, the assets are technically routed to the Uniswap OIL-USDC pool, and will remain in the Uniswap pool indefinitely.

Risk of Impermanent Loss. While the OIL staking itself does not carry the risk of impermanent loss, providing liquidity to the OIL-USDC Uniswap pool does. Once you have supplied assets to the OIL-USDC Uniswap pool, your position includes two assets — USDC and OIL. If the price of OIL changes compared to USDC, the value of your deposited assets also changes. Impermanent loss happens when the price of your deposited assets decreases compared to when you deposited them, but this loss only becomes permanent if you withdraw your liquidity from the Uniswap pool. In other words, impermanent loss means the less dollar value of your liquidity at the current moment than at the time of deposit. Also, note that your liquidity in Uniswap earns fees proportional to your share of the pool each time a trade happens which partially compensates for the impermanent loss that you may sustain. More information about impermanent loss can be found here: https://academy.binance.com/en/articles/impermanent-loss-explained