How INK Protocol works?
An overview of how to use INK Protocol.
- INK Protocol lets users deposit their UST into the protocol.
- The deposited UST is used to get yield from Anchor Protocol.
- The interest that is accrued on Anchor Protocol is then pooled into INK Protocol as prizes.
- Every week, the protocol picks 10 winners randomly to get a portion of the total deposit yield as prizes.
- Deposits give you recurring participation, which means that the deposit will keep your eligibility for every prize draw until you withdraw your deposit
More deposits, more chance
Anchor Protocol: Anchor Protocol is the Gold Standard for Passive Income on the Terra blockchain where Anchor offers a principal-protected stablecoin savings product that pays depositors a stable interest rate.
After you join the pool, the money in the pool will be deposited to a "yield fountain" ⛲ to generate interests that make up the prizes. For now, Anchor Protocol is our first yield fountain.
Deposits are placed in Anchor where they earn ~20% APR. All of this yield goes towards the prize pool. This means that unlike in normal lotteries, depositors never lose their deposits and are always making money even if they never win the lottery.
A chance to win the prize depends on how much money is deposited into the pool. For example, if the entire pool consists of 1,000 UST, and your deposit is 10 UST. Your chance of winning would be 1% (1 of 100).
Sponsor deposits: There is also sponsored deposit. Sponsor deposits voluntarily withheld from partaking in the rewards. So this essentially increases the size of the total rewards but does not decrease your chance of winning.
After each weekly round, winners will be awarded interests accrued from yield fountain(s). You can check your account section to claim a winning reward to your Terra wallet (if you were a lucky one!).