{"id":8751,"date":"2021-08-27T09:10:34","date_gmt":"2021-08-27T13:10:34","guid":{"rendered":"https:\/\/cointelegraph.com\/magazine\/?p=8751"},"modified":"2021-08-27T10:15:24","modified_gmt":"2021-08-27T14:15:24","slug":"double-dipping-defi-tushar-aggarwal-on-how-you-can-earn-liquidity-rewards-while-staking","status":"publish","type":"post","link":"https:\/\/cointelegraph.com\/magazine\/2021\/08\/27\/double-dipping-defi-tushar-aggarwal-on-how-you-can-earn-liquidity-rewards-while-staking","title":{"rendered":"Have your stake and earn fees too: Tushar Aggarwal on double dipping in DeFi"},"content":{"rendered":"

Proof-of-stake protocols were designed to encourage users to lock up their coins, but synthetic assets are circumventing that design to allow double-dipping in DeFi.\u00a0<\/b><\/p>\n

One of Forbes’ 30 Under 30 in Asia, Tushar Aggarwal wears many hats: He started the crypto podcast <\/span>Decrypt Asia<\/span>, works as a venture scout with <\/span>LuneX Ventures<\/span>, and runs <\/span>Persistence<\/span>, a platform that lets users earn liquidity rewards while they stake coins.\u00a0<\/span><\/p>\n

Aggarwal\u2019s platform issues synthetic assets, perhaps better understood as \u201credemption coupons,\u201d for staked coins that can be used elsewhere to maximize returns. This method is relevant for proof-of-stake coins, which are not machine-mined but accumulate to those who lock their tokens away from circulation. Persistence allows these staked coins to be used regardless.<\/span><\/p>\n

Originally from India, Aggarwal believes that cryptocurrency holds great things in store for the nation on both the GDP and individual worker levels. However, he works from Singapore due to the Indian government\u2019s hostility toward the industry from which it could so greatly benefit.<\/span><\/p>\n

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Fan tokens: Day trading your favorite sports team<\/a><\/h3>\n
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What it\u2019s like when the banks collapse: Iceland 2008 firsthand<\/a><\/h3>\n
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Crypto City: Guide to Tokyo<\/a><\/h3>\n
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Before NFTs: Surging interest in pre-CryptoPunk collectibles<\/a><\/h3>\n
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Bitcoin ledger as a secret weapon in war against ransomware<\/a><\/h3>\n
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Liquid staking<\/h4>\n

Aggarwal, aged 28, started his journey in crypto as an investor in 2017, soon founding and hosting the Decrypt Asia podcast where he interviewed \u201call kinds of players in the ecosystem \u2014 fund managers, investors, entrepreneurs and service providers.\u201d The podcast worked as a springboard of sorts, opening up opportunities to write<\/a> about the cryptocurrency revolution for <\/span>Tech in Asia<\/span>, \u201cthe equivalent of TechCrunch in the West.\u201d Aggarwal was an authority.<\/span><\/p>\n

In 2018, he was contacted by a venture capitalist who had come across his writings and podcast. The VC sought advice on behalf of his firm, Golden Gate Ventures, which was looking to set up a crypto fund. \u201cI basically asked them for a job on the spot and became the first employee for the crypto fund of Golden Gate \u2014 that fund is called LuneX Ventures,\u201d he recalls. Aggarwal still serves as a venture scout for the fund, which he describes as the \u201conly regulated crypto fund of a VC fund in Southeast Asia.\u201d<\/span><\/p>\n

He founded the Persistence platform in 2019 after a string of hackathons because \u201cI wanted to move over to being an operator, as opposed to a capital allocator.\u201d<\/span><\/p>\n

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Source: pSTAKE<\/figcaption><\/figure>\n

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The platform’s functions are based on the <\/span>Tendermint<\/span> algorithm, meaning that it accepts proof-of-stake coins such as <\/span>Persistence<\/span>, REN, LUNA, CRO, IRIS, BAND, and KAVA. The magic is that even after being staked, synthetic assets based on the coins can be deposited as liquidity to a decentralized exchange to earn fees while the original coins are still \u201cstaked in the background, earning you staking rewards as well.\u201d<\/span><\/p>\n

\u201cWe’re allowing you to stake in one place but issuing you a representative coin that you can use in other places.\u201d<\/span><\/p><\/blockquote>\n

\u201cLiquid staking\u201d is thus an appropriate descriptor, seeing as both liquidity provision and staking are combined. This process is beneficial because the tokenholder does not have to take a chance on either liquidity fees or staking, providing a higher yield on their capital. While the \u201coriginal\u201d coins are staked, the representative coins used to provide liquidity are 100% backed by the staked assets, meaning that \u201cwhoever ends up holding the representative coin then will ultimately get access\u201d to the underlying asset.\u00a0<\/span><\/p>\n

\u201cLiquid staking is something that basically addresses the problems of whatever 10,000\u2013100,000 folks who hold proof-of-stake coins and are familiar with how staking works.\u201d<\/span><\/p>\n

Golden years<\/h4>\n

Though he describes his parents as normal middle-class Indian civil servants, Aggarwal spent five years of his teens on the foothills of the Himalayas with \u201ckids of really powerful politicians and folks who run corporate India.\u201d The Doon School is \u201cthe Eton of India, which has produced prime ministers, army chiefs, journalists, movie stars, government officials, businessmen,\u201d he explains, comparing his school to the famous British boarding school with a similar reputation. As the school was founded when India was still a British colony, \u201cit espouses a lot of those ideals still which might be a little bit ancient from today’s perspective,\u201d Aggarwal muses.\u00a0<\/span><\/p>\n

In 2010 he headed to Nanyang Technological University in Singapore, \u201cwhich is, I think, one of the top five universities in Asia,\u201d where he studied business administration under an arrangement where he promised to stay in the country for three years after graduating in exchange for a 60% reduction of tuition fees. Aggarwal explains that this bond arrangement was part of a \u201cpolicy that Singapore had in place to attract talent from very young ages\u201d \u2014 a successful policy, seeing as Aggarwal has not returned to live in India.<\/span><\/p>\n

Graduating in 2013, he worked in private equity at PwC for two years before moving to Sia Partners, a French boutique consultancy specializing in financial services. That role saw him spend time in Hong Kong, Malaysia and Thailand while working with the private banking departments of European banks operating in the region.<\/span><\/p>\n

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A monumental achievement: We've exceeded $2,000,000 in #TVL<\/a>! \ud83d\ude80<\/p>\n

\ud83e\uddbe Take advantage of our 0% wrapping and service fees. @Cosmos<\/a> & #Ethereum<\/a> #DeFi<\/a> is taking off!<\/p>\n

\ud83c\udf10 Liquid staking awaits here: https:\/\/t.co\/ubfqwuGNDr<\/a> pic.twitter.com\/OSMt0UMRKh<\/a><\/p>\n

— pSTAKE Finance (@pStakeFinance) August 21, 2021<\/a><\/p><\/blockquote>\n