Protocol Fees

StrongHodl Fees

StrongHodl implements a transparent fee structure to support protocol operations, security, and community initiatives. These fees are carefully designed to ensure that BTC staking remains efficient and rewarding for users while promoting the growth and development of the protocols.

Fee Overview

The fees charged by StrongHodl are based on a percentage of staking rewards earned by users. This percentage is determined by the StrongHodl DAO and can be updated through community voting to reflect protocol needs and market conditions.

Types of Fees

1. Staking Rewards Fee

Description: A small percentage of the staking rewards generated by users’ staked BTC is collected as a protocol fee. This fee is automatically deducted from the rewards accrued by shBTC holders.

  • Current Rate: The staking rewards fee is set by the DAO and may be adjusted over time. The current rate is displayed on the StrongHodl platform dashboard.

  • Allocation:

    • Protocol Treasury: The remaining portion is directed to StrongHodl’s treasury. These funds are allocated for protocol improvements, research and development, community incentives, and governance initiatives.

2. Cross-Chain Transfer Fee

Description: A small fee applies when users transfer shBTC across chains (e.g., from Ethereum to Solana or vice versa). This covers operational costs and ensures a seamless and secure transfer process.

  • Current Rate: The cross-chain transfer fee is a fixed rate, which may vary depending on network conditions and operational expenses. The applicable fee is displayed at the time of transfer.

Fee Allocation

All fees collected by StrongHodl serve to strengthen and maintain the protocol:

  1. Protocol Treasury: Treasury funds are used for:

    • Continuous protocol development

    • Security audits

    • Community rewards

    • Governance initiatives This ensures the protocol remains innovative, secure, and supports long-term growth.

  2. Community Initiatives: The DAO may allocate treasury funds to community-driven projects, ecosystem partnerships, and other initiatives that benefit the StrongHodl user base.

Governance and Transparency

All fees and their allocations are transparent. Any changes to the fee structure are subject to a governance vote by StrongHodl DAO members. This ensures that fee structures remain fair and aligned with the community's interests. Fee allocations and updates are displayed on the StrongHodl dashboard, allowing users to stay informed.

StrongHodl’s fee structure is designed to create a sustainable and rewarding environment for shBTC holders while supporting the protocol’s mission to bring Bitcoin into the DeFi ecosystem with security and transparency.

Babylon Protocol Foundation

StrongHODL is built on the Babylon Protocol, providing the infrastructure for secure synthetic asset minting, cross-chain bridging, and decentralized governance. Babylon's architecture ensures safe and reliable management of synthetic BTC on Ethereum and Solana.

Key Components

Synthetic BTC (shBTC) Minting

The protocol allows users to mint shBTC by collateralizing assets on Ethereum or Solana. Minted shBTC can then be utilized across the DeFi ecosystem of the supported chains.

Cross-Chain Bridging

The StrongHODL bridge enables users to seamlessly transfer shBTC between Ethereum and Solana, enhancing accessibility and flexibility within both chains’ DeFi applications.

Role-Based User Management

The protocol implements a role-based access model, granting users varying privileges based on their engagement level:

  • Basic User: Standard access for minting and managing shBTC.

  • Liquidity Provider: Privileged access with reduced fees for providing liquidity.

  • Governance Participant: Voting rights for protocol decisions and governance proposals.

Real-Time On-Chain Analytics

Through Dune integration, StrongHODL offers a real-time analytics dashboard, tracking metrics such as transaction volumes, user participation, and liquidity pools. This empowers users to make data-driven decisions.

Protocol Components

  1. Minting Mechanism: Supports collateralized shBTC creation on Ethereum or Solana using Babylon Protocol.

  2. Bridging Mechanism: A secure and efficient cross-chain bridge for shBTC transfers between Ethereum and Solana.

  3. Role-Based Access Control: Backend management for user permissions and role-based activities.

  4. DeFi Integration APIs: Open APIs for seamless shBTC integration with Ethereum and Solana DeFi platforms.

  5. Analytics Dashboard: A Dune-powered dashboard offering real-time tracking of protocol usage and performance metrics.

Technical Specifications

  • Blockchain Compatibility: Ethereum and Solana

  • Protocol Foundation: Babylon Protocol

  • Supported Integrations:

    • Ethereum DeFi:

    • Solana DeFi:

    • Bridging Solution:

    • Analytics Provider:

APIs

DeFi Integration API (Ethereum)

Enables shBTC to interact with Ethereum-based DeFi platforms, supporting staking, lending, and liquidity provisioning.

DeFi Integration API (Solana)

Provides shBTC functionality within Solana’s DeFi ecosystem, allowing participation in staking, lending, and other financial products.

User Data API

Offers analytics on user roles, activities, and metrics for role-based engagement and monitoring.

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