Multiply while earning staking yield
If you want to HOLD staking assets and increase exposure to that asset, while continue to earn staking yield APR such as DOT staking, you can mint Acala Dollar using staking-yield-bearing asset LDOT (Liquid Staking DOT powered by Homa Protocol) as collateral, then purchase more of this yield-bearing asset on the open market.
How to multiply exposure of staking asset while earning staking yield:
  • Connect your wallet that has assets that you plan to use as collateral e.g. if you want to multiply DOT exposure, use a wallet that has DOT
  • Bridge the collateral assets to Acala or Karura network if they are not already on the respective networks (to bridge DOT ecosystem assets use this guide, to bridge KSM ecosystem assets use this guide)
  • Mint staking derivative using a supported protocol such as Homa Staking, deposit staking asset and mint derivative asset that is staking yield bearing e.g. LDOT represents DOT principle + DOT staking yield accumulated
  • Select the collateral asset type as the staking derivative asset
  • Enter the amount of collateral you'd want to deposit
  • Enter the amount of Acala Dollar that you would like to borrow. Note the stability fee, required collateral ratio, min required to mint, liquidation price etc risk parameters are in line with your risk expectations. You are simultaneously earning staking yield while borrowing!
  • Then confirm the transaction, and expect Acala Dollar be in your wallet
  • Go to an exchange of your choice e.g. AcalaSwap
  • Choose a trading pair between Acala Dollar and the collateral asset used e.g. LDOT/aUSD, and swap aUSD for LDOT
  • Navigate back to the Acala Dollar main page, and click on Manage for the particular loan
  • Under the Collateral tab, deposit more collateral asset into the vault and confirm
  • Now you have additional exposure to the staking asset compounding its staking yield
  • You can repeat this process until you are satisfied with the exposure multiples and of course, be mindful of the changing collateral ratio and Liquidation Price, which does imply higher risks
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