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February 16, 2023, 02:50:34 AM
Last edit: February 16, 2023, 03:14:44 AM by Bialke |
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Ringstaking
[Tutorial by Roland Ionas Bialke, 14.02.2023]
Idea:
We are using the fact, that a CEX is paying a full staking interval (3 days) for the (flexible) short-time staking (a few minutes) of one asset.
Example:
As an example we are using the CEX "kraken.com" and the crypto asset "Mina Protocol (MINA)". In our example the Ringstaking is done by 20 person, which are citizens of the EU. We are using 10.000 MINA for the transactions.
- 10.000 MINA
- 20 persons
Native staking:
For 10.000 MINA we would get ~20 MINA staking rewards for 3 days (bonded) staking in the native MINA-wallet "Auro".
Executing:
The first person is staking the 10.000 MINA in the flexible staking of the CEX. After a few minutes the person is unstaking the 10.000 MINA and is sending the MINA to the next person in the Ringstaking. After 3 days the CEX is paying the first person ~10 MINA staking rewards. The costs of sending the MINA to another person are ~0,5 MINA gas fees.)
The next person in the Ringstaking is doing the same: Flexible short time staking of the 10.000 MINA on the same CEX, Unstaking and sending to the next person of the Ringstaking. Also this person is getting the ~10 MINA staking reward from the CEX. The gas fee is again ~0,5 MINA.
This is done again and again until everybody of the 20 persons was staking the 10.000 MINA one time.
Results:
20 persons x 10 MINA = 200 MINA
0,5 MINA gas fee x 20 persons = -10 MINA
1,0 MINA (to open an AURO wallet) x 20 persons = -20 MINA
170 MINA (Ringstaking)
40 MINA (native Staking)
Reward with no "stakes" per person: ~6,5 MINA
Conclude:
It is possible to do Ringstaking on different CEXs which are allowing flexible short-time staking with the opportunity to get the full reward for the minimum staking interval of one asset. Also the Ringstaking is possible for different assets.
It is possible to make these kind of transaction automatic. And it is possible to have a bigger pool of Ringstakers on a small amount of Ringstaking liquidity givers. In this context it is possible to make 666 percent staking rewards in 3 days. And much much more...
Concerns:
It is no coincedence that staking is on the repressive list of governement bodies like SEC in the United States of America. A lot of the bigger CEX are doing or a lot of shady stuff - or letting it happen, like money laundering, washing of tainted coins, artificial volume extention and insider trading. The author is concerned that CEXs are calculating with this kind of opportunitys to blow up artificial the volume of their assets. Also tax fraud is possible in that context.
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