Exploring the Octant Ecosystem Part 2: Your Guide to Staking GLM and Funding Public Goods with Octant
By: Tereza Bízková & Drew Simon
Traditional financial systems are often viewed as a zero-sum game, where one person's gain comes at another's expense. But imagine a different scenario—a model where building personal wealth also benefits the community and the world at large. What if you could achieve financial success while simultaneously making a positive impact?
This vision isn't just idealistic; it's entirely feasible thanks to the innovative financial models being unlocked by web3. One of the most exciting possibilities is that your financial investments can do more than just increase in value.
In our recent article, we explored Octant, a platform that lets anyone earn rewards while supporting causes they care about through a unique public goods funding model. Octant merges cryptocurrency with public goods funding, supported by the Golem Foundation’s staking of 100,000 ETH from its treasury, providing a solid financial backbone for experimentation and impactful community projects.
💸 What is staking? Cryptocurrency staking involves locking up a certain amount of your digital assets in a blockchain network to support its operations, such as validating transactions, in exchange for earning rewards. It helps maintain the security and efficiency of the blockchain, providing a way to earn passive income.
octant in a nutshell:
— Octant (@OctantApp) June 25, 2024
💰💚we staked 100,000 ETH and staking rewards go to funding public goods
our users decide how this funding is split up between projects and how much each project gets (or doesn’t get)
okay but how? well as a user, you can lock GLM into Octant anytime. our…
For a deep dive into Octant, including an overview of its approach to funding public goods, make sure to read Part 1 of the Series: Octant: Funding Public Goods Through Innovative Community Decision-Making.
In the second article of the Octant series, we’ll take a closer look at how you can stake GLM tokens to get involved in the ecosystem and support public goods funding for projects you care about.
Why Stake GLM?
Whether you’re a web3 newcomer or you’ve seen a few market cycles already, staking the GLM token on Octant has different advantages.
Earn ETH rewards: One of the main incentives for staking GLM is earning rewards in ETH. The system favors long-term commitment by using a time-weighted average to calculate rewards. The longer you stake your tokens, the more substantial your rewards. This approach encourages ongoing participation and supports the overall stability of the Octant ecosystem.
Influence community projects: Staking GLM gives you voting power in token-weighted polls that decide which public goods projects receive funding. This democratic process ensures that the community has a direct say in the allocation of funds, promoting transparency and collective decision-making. Your staked GLM not only earns you rewards but also empowers you to support projects that align with your values and interests.
Support public goods: By staking GLM on Octant, you help fund meaningful projects. The platform channels a portion of the staking rewards into funding public goods projects, ranging from environmental initiatives to educational programs. Participating in Octant means actively supporting the development and sustainability of projects that positively impact society.
In essence, staking GLM allows you to earn rewards in ETH for yourself and join an incredible community of changemakers while having a say in how funding is allocated to public goods projects.
How Staking GLM Works
Before diving in and staking your own GLM, there are a few useful things you should know.
When you decide to stake or “lock” your GLM tokens on Octant, you initiate the process by locking them into a smart contract. This mechanism is non-custodial, which means that while the tokens are locked, they are not pooled with other users' funds.
Instead, each user's tokens are individually locked and tracked, maintaining full ownership and control by the user.
🤝 Smart Contracts are self-executing contracts with the terms of the agreement directly written into lines of code. They automatically carry out transactions and enforce rules on the blockchain without the need for intermediaries.
The locked tokens are stored securely in a smart contract, and users can unlock them at any time. However, to maximize rewards and participate fully in governance, you might want to keep the GLM tokens locked for the entire 90-day epoch.
Unlocking tokens before the end of an epoch will adjust your time-weighted average, potentially reducing your earned rewards. Additionally, if your effective locked balance drops below 100 GLM, no rewards will be calculated.
Simply put, the rewards are calculated based on how long the tokens remain locked and the amount locked, ensuring that users who contribute more and for longer periods receive higher rewards.
Locking, unlocking, and rewards withdrawals incur gas fees since they happen on-chain. These transactions require network fees to be processed on the Ethereum blockchain.
In contrast, allocation decisions are conducted off-chain and are free, allowing users to change their allocation choices multiple times during the allocation window without incurring any financial costs.
Then, there’s the exciting part: At the end of each 90-day epoch, the rewards distribution process begins. Users can choose to withdraw their earned ETH rewards to their wallets or donate them to public good projects listed on Octant.
Donations are particularly encouraged, as they receive a boost from the matching pool, amplifying their impact. This system not only rewards individual users but also supports community-driven projects, fostering a collaborative environment for the development of public goods.
Source: Octant
Staking GLM also grants you voting power in token-weighted polls. Your voting power is proportional to your effective locked balance, giving more influence to users who stake more tokens for longer periods.
It is also important to note that if you do not withdraw your rewards or donate them during the allocation period, you will lose them. Rewards do not accumulate if not used during the allocation window, so it is important that you either withdraw or donate your rewards. That being said, rewards that are not claimed or allocated are returned to the Golem Foundation to support their mission.
By understanding these intricacies, you can make informed decisions about staking your GLM tokens on Octant, maximizing your rewards while supporting valuable community projects.
Now, join us as we take a look at a step-by-step staking process and stake some GLM of our own!
How to Stake GLM
Step 1: Connect Your Wallet
First, launch the Octant app and connect your WalletConnect-compatible wallet. Click on the "Connect wallet" button at the top of the screen and follow the instructions provided by your wallet. During the onboarding process, you’ll need to review and agree to the Terms of Use by clicking a checkbox and signing a message in your wallet.
Step 2: Lock GLM Tokens
Navigate to the Earn tab and lock your GLM tokens. While you can lock as little as 1 GLM, an effective locked balance of at least 100 GLM is necessary to qualify for user rewards. If you don't already have GLM tokens, you can acquire them from many large exchanges or via Uniswap.
Use the in-app Reward calculator to estimate the potential rewards based on your locked GLM amount and the duration of the lock.
This tool provides a detailed estimate, helping you make an informed decision. Once you’ve decided on the amount, click the "Lock" button and approve the transaction. Remember, locking and unlocking GLM incurs gas fees since these actions occur on-chain.
Step 3: Monitor and Withdraw Rewards
After locking your GLM, monitor your rewards and effective locked balance in the Wallet view. This view also shows your balances in ETH, GLM, and their fiat equivalents, along with your rewards budget and pending allocations.
You can withdraw your claimed rewards in ETH at the end of the current allocation window. There is no set withdrawal deadline, giving you flexibility in managing your assets.
Check out the video below where we walk through the process of locking in our own GLM and joining the community of public goods builders! 🙌
Wrapping Up
If you’re interested in diving into more web3 projects, especially those in the realm of public goods, Octant offers a straightforward way to get involved and join an incredible community of changemakers. It’s a great way to engage with emerging technologies and contribute to meaningful public goods projects.
Remember, it’s always a good idea to start by engaging with the community and learning. It’s also important to acknowledge that there are always risks with staking or locking any cryptocurrency, so it’s important to do your own research before diving in.
One great place to do this is Octant’s Governance Forum or Discord Channel, where you can ask questions, and participate in discussions to better understand how you can contribute and benefit.
As Octant evolves quickly and continues experimenting with public goods funding mechanisms, staying informed through community channels can help you adapt to any changes each epoch might bring.
So what are you waiting for? Join us in being a part of a pioneering community that's reshaping the future of public goods funding.
Share Your Public Goods Story, Earn GLM!
We have some exciting news! Our friends at Octant will be giving away 500 GLM each to five readers who are interested in joining the Octant Community!
To participate in this giveaway, simply share your Public Goods Story by commenting on this article, including a brief description of your project and your public goods vision! We will share the stories on a future X space, which you will be invited to, and will announce the three recipients there.
To participate, please make sure to share your Public Goods Story in the comments by August 30, 2024!
Tereza Bízková is a Colombia-based journalist, tech writer, and the co-founder of ReFi Medellin. Her passion for technology and a master's degree in Defence, Development, and Diplomacy fuels her exploration of how innovation can drive social change.
Drew Simon Founded Crypto Altruism in 2021 with a mission to show the world the good of Web3. Having worked in the nonprofit sector for over 10 years, Drew believes that Web3 can be a transformational tool for social causes around the world.
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Thank you to Octant for their support in bringing this series to life! We are honored to have received a 2.5 ETH grant through the Octant Community Fund.
