An introduction to SFT on FVM
Congratulations to the Filecoin team on successfully launching FVM on its mainnet today. The main network will officially obtain EVM virtual machine compatibility through the Filecoin nv18 Hygge upgrade and become a Layer 0 public chain integrating data storage, smart contract deployment, and dApp development.
What will the SFT Protocol do on FVM?
The SFT Protocol will build a series of smart contracts on FVM to provide a decentralized protocol that enables the free circulation of locked FIL assets. Based on the FIL stake provided by users, the smart contract will generate a corresponding amount of SFT.
What is SFT?
SFT represents the staked FIL in Filecoin, and its value includes the initial deposit and stake rewards. SFT is minted when FIL is deposited, and SFT is destroyed when FIL is redeemed. The number of SFTs is linked to the FIL staked in Filecoin on a 1:1 basis.
SFT can be used like FIL, allowing you to obtain staking rewards, and at the same time, you can also obtain additional income through decentralized financial products in the SFT ecosystem, such as liquidity mining income, protocol governance token income, etc. SFT has good liquidity, and you can use SFT according to your needs at any time, such as trading, selling, exchanging, or putting tokens into DeFi projects, etc.
How is SFT generated?
As shown below:
1. The user stakes FIL to the SFT contract through the Filecoin chain.
2. The SFT contract transfers FIL to the encapsulation node.
3. The encapsulation node opens the encapsulation. After completion, the system SFT-Mint contract starts to mint SFT.
4. For the minted SFT, the contract will be automatically distributed to the user’s decentralized wallet address.
5. The above process will all be uploaded to the chain and verified by the master node, packaged, and recorded by all nodes.
What are the applicable ecology and functions of SFT?
1、Yield Generating
SFT holders are entitled to staking rewards from their staked assets by leveraging SFT Protocol permissionless liquid staking technology
2、Reward Bearing
SFTs are synthetic representations of users’ staked assets and attached staking rewards. Its value gradually increases over time.
3、Free Trading
SFTs are transferable and tradeable on DEXes, allowing stakers to obtain their underlying staked assets at any time.
4、Non-Custodial
SFTs and staked assets in the SFT staking contract are completely non-custodial, trustless, and community-owned.
5、Withdraw Freely
SFTs are completely free to withdraw the underlying staked assets
6、Airdrop Certificate
SFT holders get early governance token airdrop certificates
If you want to know more about the application of SFT Protocol on FVM or have some other questions, welcome to our AMA event.
We will draw followers who ask questions during the AMA event to issue airdrops.
Link: https://twitter.com/SFTProtocol/status/1635228970219372546
🔗Official links: SFT Protocol Twitter Discord Telegram Gitbook Youtube Linktree
