The number of 0x (ZRX) tokens being staked for rewards continues to climb and at the time of writing this article the figure stood at over 2.5 million, worth approximately $500,000. According to Etherscan, the figure more than doubled in a 11 hour period hinting at the growth potential for the burgeoning decentralised finance (DeFi) ecosystem.
Over 1 million ZRX has already been staked! ?https://t.co/1pK6RV358j
Join your fellow token holders and put your ZRX to work ? https://t.co/If5OgWarnu
— 0x (@0xProject) January 9, 2020
As an open protocol, 0x enables peer-to-peer exchange of assets on the Ethereum blockchain and has a variety of use cases including providing the structure to build decentralised versions of existing markets or initialising new ones specifically for blockchain innovation.
Incentivised for Liquidity
An initial ZRX token sale ended in August 2017 and it went on to become the first ERC-20 token listed on professional trading exchange, Coinbase Pro, the following year.
The ability to delegate ZRX tokens to staking pools became a reality with the community’s acceptance of version 3 (v3) of the protocol in December 2019.
As confirmed in a recent 0x social media post and associated video, the rewards paid in ETH incentivises ZRX holders to stake their tokens, either as a market maker or assigned to a staking pool, to provide liquidity for the ecosystem.
Set time frames, called “epochs”, last for 10 days and once completed a smart contract distributes a portion of the fees generated on each 0x v3 trade to the staking pools that have been set up by market makers.
According to 0x, “The size of each distribution is determined by (1) the amount of liquidity the market maker provided during the epoch and (2) the relative number of ZRX staked in the pool.” The market maker can in turn decide to share a percentage of their reward with delegators.
A ZRX Portal has been initiated for ZRX holders to research and identify market makers who best suit their level of holdings and can optimise the most rewards.