Staking

Staking is the primary value accrual strategy of Parrot DAO. Stakers stake their PARR tokens on to earn rebase rewards. The rebase rewards come from the proceeds from bond sales, and can vary based on the number of PARR staked in the protocol and the reward rate set by monetary policy.

Staking is a passive, long-term strategy. The increase in your stake of PARR translates into a constantly falling cost basis converging on zero. This means even if the market price of PARR drops below your initial purchase price, given a long enough staking period, the increase in your staked PARR balance should eventually outpace the fall in price.

When you stake, you lock PARR and receive an equal amount of sPARR. Your sPARR balance rebases up automatically at the end of every epoch. sPARR is transferable and therefore composable with other DeFi protocols.

When you unstake, you burn sPARR and receive an equal amount of PARR tokens. Unstaking means the user will forfeit the upcoming rebase reward. Note that the forfeited reward is only applicable to the unstaked amount; the remaining staked PARR (if any) will continue to receive rebase rewards.