If you’re wanting to figure out Curve, please read the starter guide at this address. After reading this, you should have an understanding of how Curve works, how it makes money for liquidity providers and its risks which is ideally what you want before providing liquidity.
For most people, Bitcoin is an investment that’s hopefully safely stored on a Ledger or a Trezor but otherwise not doing very much. One of DeFi’s longterm goals has always been to bring Bitcoin to Ethereum and it seems it is finally happening as there is now over $50m worth of Bitcoin on Ethereum.
As a result, your Bitcoins can now be put to work on the Ethereum blockchain and one of the best offerings is Curve.fi sBTC pool. Below is a tutorial on how to provide liquidity as well as a short FAQ about the sBTC pool.
As a reminder, the sBTC pool is incentivised for 10 weeks starting from the 19th of June 2020 which allow users to receive SNX, REN and BAL on top of the trading fees. You can find more information about all this on this guide.
The CRV rewards will run in perpetuity.
To follow the tutorial below, you will need Bitcoin, a small amount of Ethereum to pay for gas, Metamask or another web3 provider.
1. Depositing into the pool
Visit the deposit page (https://www.curve.fi/sbtc/deposit) and click on Deposit Bitcoin at the top. If you have any doubts about this process, you can find a guide that goes into more details by clicking here.
Enter the Bitcoin amount you wish to deposit and click "Deposit". That will reveal a box at the bottom with a Bitcoin address where you should deposit your Bitcoin. After waiting for the six confirmations, you will be prompted to sign a free transaction (if not click the resubmit button) to deposit your tokens into the pool. Once that's done, there will be a second transaction to confirm that will start staking your LP (Liquidity Providers) tokens.
To check everything is in order, visit the profit page to check your funds are in the pool as well as staked: https://www.curve.fi/sbtc/profit
This feature is still in Beta so it is recommended to test with a small amount first. The fees include a 0.10% fee that goes to renVM, a Curve swap fee of 0.04% as well as the cost of a Bitcoin transaction (which is around $3 at the time of writing).
2. Staking for CRV
So your Bitcoin will now start earning fees every time someone trades on Curve or via Curve.
After depositing in the pool, you receive liquidity provider (LP) tokens. They represent your share of ownership in the pool and you will need them to stake for CRV.
Head over to Curve DAO at this address: https://dao.curve.fi/minter/gauges, scroll down to "sbtc Liquidity gauge" and click deposit. This will place your LP tokens into the gauge and you will start earning CRV, SNX, REN and BAL.
You can claim all those rewards from the minter gauge.
3. What now?
Fees are accumulating and compounding themselves on Curve and incentives are accruing every block. You can claim your staking rewards whenever you wish. They also do not expire.
That’s the final part of the tutorial. We will now go through a few questions about the process and the rewards.
Do I have to do anything else?
What are BPT tokens?
BPT stands for Balancer Pool Token. It is a pool that can contain a list of various tokens on Balancer.finance. This specific pool contains REN and SNX.
As of today, 1BPT is around $1699.87 and is shared between SNX and REN as follow: 79.82% SNX, 20.17% REN.
You can find update exchange rates on this jsFiddle: https://jsfiddle.net/3pjcmtaq/
How do I trade BPT for REN and SNX?
Simply visit the pool’s address on balancer at the address below (Ethereum at 0x330416C863f2acCE7aF9C9314B422d24c672534a):
And click the remove liquidity button.
How about the BAL tokens?
BAL tokens are rewards for liquidity providers on Balancer which you can also get as long as you do not remove your BPT from Balancer.
It is not particularly easy to understand but your rewards (BPT which is SNX and REN combined) are being provided as liquidity on Balancer. If you keep those rewards untouched as BPT tokens then you also get rewarded for providing liquidity on Balancer in the form of BAL tokens.
BAL tokens aren’t out yet but they will be rewarded retroactively which means unless you wish to immediately sell your REN or SNX, it is best to keep your BPT untouched (if you claim your SNX and REN through Curve, you will not be holding BPT anymore).
How about CRV tokens?
CRV is the Curve native governance and utility token. Find out more by clicking here.
How about going back to actual Bitcoin?
The renBridge linked above allows you to exchange renBTC for Bitcoin and wbtc.cafe allows you to exchange wBTC for Bitcoin.
What about risks?
There are a few risks to keep in mind when providing liquidity on the sBTC pool:
- You have systemic exposure to all of the Bitcoin tokens (sBTC, wBTC, renBTC).
- Smart contracts vulnerabilities with Curve(note that Curve has been audited, read here)
If you have any issues or questions, join the friendly and helpful Curve community on Telegram by clicking here.
If you want to learn more about how Curve works, read a starter guide by clicking here.
Always remember, DeFi is very new, much like Curve is and as per their FAQ:
Please don’t supply your life savings, or assets you can’t afford to lose, to Curve, especially as a liquidity provider
If you have any other questions or need help, join our community: