Learn how to stake into one of Drift's Insurance Fund Vaults in this step-by-step guide.
Insurance Fund Staking
With the launch of Insurance Fund Staking, traders can actively participate in the exchange's growth. Insurance fund stakers receive a portion of the revenue generated by Drift for contributing liquidity.
To learn more about the Insurance Fund, read more in our official Insurance Fund Staking announcement here.
Insurance Fund Vaults
Any user of the protocol can stake into the Insurance Fund through the Insurance Fund Vaults and in return earn a proportionate hourly share of the Revenue Pool, made up from perpetual market, spot market, borrow, and liquidation fees. While generating fees is the upside, the downside of staking into Insurance Fund Vaults is the risk of resolving trader bankruptcies/vAMM deficits.
Before staking, it's important to understand the risks of staking as the Insurance Fund maintains the solvency of the exchange in the event of bankruptcies by protecting against levered losses sustained by traders and/or vAMM deficits. It's important to note that there is also a 14-day cool down period for unstaking from the Insurance Fund.
For more details, read our docs.
How To Stake to the Insurance Fund
You need an active Drift account before you can begin staking.
First, head to app.drift.trade/earn/stake.
Choose your preferred Insurance Fund Vault — currently, these are available for USDC and SOL.
In this example, we'll be staking into the SOL vault — click on the “Stake” button.
Specify the SOL amount you’d like to stake in the pop-up modal.
Please take the time to read through the T&Cs and only check the boxes if you have read the associated information thoroughly and understand the risks of staking.
After doing so, click the “Confirm Stake” button.
You’ll now earn hourly fees on your stake collateral!
How To Unstake From the Insurance Fund
If you’d like to unstake from an Insurance Fund Vault, head to drift.trade/earn/stake, click on the vault, and toggle to “Unstake” at the top of the pop-up modal.
Specify the amount you’d like to unstake and request an unstake. After a 14-day cool down period, you'll be able to withdraw your funds.
Please note that you can only have one pending unstake request per vault at a time.
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