Decentralized earning is at the center of activities in the entire blockchain, crypto, and decentralized finance (DeFi) ecosystem.
In line with this, Convex Finance introduces an interesting way to earn amazing rewards and claim boosted CRV rewards without having to lock up their CRV tokens. This means that liquidity providers (LPs) now have the opportunity to earn rewards while doing the barest minimum.
This article is an in-depth overview of the Convex Finance ecosystem, its CRV tokens, how to stake CRV tokens, and what LPs stand to gain from interacting with Convex Finance.
Before we move on, let’s find out more about Convex.
What Is Convex Finance?
Convex Finance is a unique platform providing Curve.fi LPs with the opportunity to earn trading fees as rewards. These LPs can also claim boosted CRV rewards without having to lock up CRV tokens. Splitting trading fees between users and LPs allows for improved capital efficiency. It also ensures a balance between liquidity providers (LPs) and CRV token stakers.
Convex is also known for being cost-effective. The platform charges zero fees for withdrawals and also ensures performance fees are at the barest minimum. Performance fees, also known as gas fees, are usually distributed to CVX stakers. Interestingly, on Convex, both LPs and CRV stakers receive CVX as a form of mining reward. CVX is also the native token of the Convex Finance ecosystem. The tokens also serve as governance tokens with their holders in charge of veCRV token allocations.
Liquidity Providers (LPs) On Convex Finance
Liquidity providers (LPs) and stakers are the backbones of the Convex ecosystem. On Convex, LPs will earn trading fees and also claim boosted CRV. As previously stated, LPs do not also need to lock up any CRV tokens to be able to earn these rewards.
On Convex, LPs will:
- Earn CVX tokens as rewards.
- With these CVX tokens on Convex, LPs will be able to earn some of Curve’s LP CRV rewards.
- CVX stakers will also receive the CRV earnings as tokenized veCRV (cvxCRV).
- Stakers can then trade the cvxCRV tokens in the cvxCRV/CRV liquidity pool.
2. Receive claimable CRV tokens with a high boost without locking any CRV tokens.
3. Also, enjoy zero deposit and withdrawal fees.
4. Lastly, enjoy zero fees on all extra incentives or rewards (e.g. SNX tokens).
How to Stake Curve LP Tokens on Convex
- The first is to open the Convex Finance website.
- Next is to locate the “Stake” icon.
- Then click on the “icon” and scroll down to locate the “Stake Curve LP Tokens” section of the webpage.
- On this page, search out or locate the LP token you are looking to stake on Convex.
- Next, is to input the desired token amount for staking and approve the amount.
- Once confirmed, you can then click on the “Deposit and Stake” icon to deposit the token on Convex.
It is also important to note that LPs can easily withdraw their tokens at any time.
How to Stake CVX Tokens on Convex
Staking CVX is similar to staking Curve LP tokens on Convex
- The first step is to also go to the Convex Finance website.
- Then navigate to the “Stake” icon on the website.
- Scroll down to the “Stake your CVX to earn cvxCRV” option on the webpage
- Then input the quantity of CVX tokens you want to stake. You might also need to approve the “Approve” button if it pops up.
- If not, the next step is to click on the “Deposit and Stake” icon to deposit CVX tokens on Convex and start earning a portion of Curve’s LP CRV rewards.
Staking CVX means stakers will earn 5% of all of the platform fees. The earnings will also be made in cvxCVR tokens. Stakers can also unstake and withdraw their tokens at any time.
In conclusion, Convex Finance takes earnings for Curvefi liquidity providers (LPs) to new heights. Giving LPs the opportunity to earn amazing rewards without having to lock up their CRV tokens.
CRV Price Outlook
At the time of writing, CRV was trading at $0.820209, with a market cap of $320,709,917 and a 24-hour trading volume of $144,975,064. The token price is also up by 9.9% in the last 24 hours.
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