Summary: Stargate Finance is a cross-chain liquidity protocol that allows users to swap stablecoins between a variety of Ethereum Virtual Machine (EVM) compatible networks. The Stargate Finance protocol currently supports Ethereum, Avalanche, BNB Chain, Arbitrum, Optimism, Fantom, and Polygon (MATIC).
The Stargate platform also pays up to 8% APY for investors to deposit stablecoins as a reward for providing liquidity.
- Earn up to 8% APY on Stablecoin Deposits.
- Secure Cross-Chain DEX for Stablecoin swaps.
- Compatible with 6 different EVM-based Networks.
What is Stargate Finance?
Founded in 2022, Stargate Finance is a cross-chain DEX that was built by the LayerZero Labs team that is designed to be a major competitor to Synapse Protocol. The Stargate application allows users to swap 1:1 native assets cross-chain which include USDC, USDT, BUSD, FRAX, ETH and other tokens.
Stargate has a native token called $STG that is used as the governance token for the protocol. Users are paid out $STG tokens as an incentive to deposit stablecoins that provide liquidity for cross-chain swaps.
Stargate Finance STG Tokenomics
Currently, the STG token does not have a functioning tokenomics or value accrual mechanism. The reason is that the founding team has not yet activated the 'fee switch' that would allow STG and veSTG stakers to earn fees from swaps occurring on the Stargate DEX. By the end of 2022, the fee switch is anticipated to be enabled, making STG tokens stakeable for revenue sharing on the platform. At present, the only way to stake STG tokens is by providing liquidity to STG pairs on Uniswap or other decentralized exchanges.
Is Stargate Finance Safe?
The Stargate Finance platform is a safe way to move stablecoins across various chains, and a safe platform to deposit coins to earn yield. The application was founded by Bryan Pellegrino who is the Co-Founder and CEO of LayerZero Labs. Bryan and his team are based in Vancouver, Canada, and are fully doxxed and backed by some of the largest VCs in the space.
The current fee to move tokens across chains is 0.1% or 10 basis points (10bps). This is lower than alternative cross-chain bridges like Synapse, AnySwap and Allbridge which charge a base rate of 0.2%, which is currently double Stargate. Stargate Finance also offers the best yields to deposit stablecoins with up to 7.5% APY to deposit USDC on secure networks like Polygon and Avalanche (AVAX).
Stargate Finance Slippage
The slippage to move between networks is 0.5% on Stargate Finance. This means that if you want to move 1000 USDC tokens from Ethereum to Avalanche (AVAX), you will lose a maximum of 0.5% in the swap (5 USDC). This is a relatively small slippage compared to competitor platforms on any chain.
As you can see in the example below, when we move 1000 USDC from ETH to AVAX, we only lose 1.6 USDC - which is much less than the slippage amount quoted.
In conclusion, Stargate Finance is a secure cross-chain liquidity protocol enabling users to swap stablecoins among various EVM-compatible networks, such as Ethereum, Avalanche, BNB Chain, Arbitrum, Optimism, Fantom, and Polygon. Offering competitive fees and up to 8% APY for providing liquidity, Stargate Finance presents an attractive option for investors.
While the platform's native token, $STG, currently lacks a value accrual mechanism, revenue sharing is expected to be introduced by the end of 2022. With lower fees and slippage compared to its competitors, Stargate Finance stands out as a promising choice for cross-chain stablecoin swaps and yield opportunities
Co-Founder & former Investment Banker (Finance MBA) turned Full-Time analyst and Head of Research at Buy Bitcoin Bank. Left traditional finance to pursue my interest in digital assets and decentralized finance.