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How to get baking rewards on QuipuSwap and Vote for a baker?

Written by Martin J. Maddox
Updated 1 month ago

This tutorial  explains how to add Liquidity to QuipuSwap, start earning baking rewards, and vote for a baker.

if you don't know what is Baking, please watch our educational video.

How to add your LP tokens to QuipuSwap:

Firstly, you need to ad Liquidity to QuipuSwap. Please, read how to add your liquidity to an existing pool or how to create a new one.

After adding Liquidity you receive Shares (LP tokens). You will automatically receive Baking rewards that will distributed in accordance with the percent of LP tokens in your Liquidity Pool.

When may I get my first Baking Reward?

In case your liquidity pool has just been created, your first baking rewards should be received approximately in 30 days. The reward is collected by QuipuSwap for the 30 days and linearly distributed during the next 30 days.

So, you need to wait approximately 60 days to see your rewards in the Rewards tab after the pool creation.

If your pool was created more than two months ago, you might receive rewards the next day after getting LP tokens.

How to check the current baking rewards for the pool?

Visit tzkt.io, choose your pool, click rewards, and see the Expected payout column.

Unfortunately, it's hard to see a timestamp of the each operation and you need to use tzkt api to get a required data. However you may see if your pool has received any rewards from a baker already.

How it works under the hood:

The bakers rewards are distributed proportionally to your share in the pool and the time you keep the tokens in the pool. In fact, the reward from bakers is collected for 30 days and then distributed for the next 30 days (fixed amount every second). It uses the same mechanics as the most of yield farms but instead of minting and distributing new tokens the baker rewards are distributed. 

Example - how it works:

Your Liquidity Pool in 30 days earned 100XTZ in baking rewards. After 30 days from the pool launch QuipuSwap starts to distribute these rewards among LP token holders in proportion to their shares.

In this specific case, QuipuSwap in 30 days will distribute 0.00000385802469 XTZ  every second in proportion to the number of LP tokens in the pool.

What affects the number of rewards?

The reward you may get in this month is influenced by the number of tokens in the pool in the previous month and your LP tokens in the pool.

Why don't I see baking rewards?

1. You need to have your LP tokens in your wallet to get rewards. Please, don't use LP tokens in farming or other activities. 

2. If your LP tokens were staked in a farm, all baking rewards will be collected by the LP token holder. In your case, they will be collected by a farm project. 

3. If a farm project doesn't collect baking rewards they will stay on the pool contract. 

How to get Baking Rewards on your wallet

 1. Visit the Governance section.

2. Choose your Liquidity pool

3. Find the "Rewards" tab

4. Enter your XTZ address

5. Click the  "Withdraw" button

6. Confirm operation in your wallet.

How to vote for a baker

1. Choose a Liquidity Pair where you have shares

2. Choose a Baker who whom you want to vote

3. Add the number of shares that you want to stake and vote

4. Click Vote or Revote.

Important! Your shares are LP tokens. When you vote for a Baker, you stake these LP tokens in our smart contract. As a consequence, they can't be used in other DeFi projects. Also, the LP token balance in your wallet will show 0.

5. Confirm this transaction in your wallet

Wait a minute. You will see a success status.

How often may a baker be chosen?

You may vote for a baker any time without limitations. Baker, who received 50% + of the pool shares, becomes a validator. If a pool has low liquidity, LP providers may change bakers frequently. When there is more liquidity in the pool, it will be harder to replace an elected baker.

If you encountered any problems, please feel free to ask your questions in our telegram or discord communities.

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