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The Collectif Liquid Staking protocol operates on a profit-sharing model. In this system, Storage Providers (SPs) leverage the staked Filecoin (FIL) from the liquid staking pool as an initial pledge to onboard storage capacity on the Filecoin network. In return, they distribute a portion of their mining rewards to the pool.
The profit-sharing ratio is usually based on the risk profile of the SP and past performance. This ratio typically remains stable unless there are significant changes to the SP's profile or if the DAO makes the decision to adjust the ratio to maintain competitive staking rewards.
This profit-sharing model offers advantages over interest-rate-based protocols. It provides simpler financial management for SPs, particularly during market uncertainties. As Filecoin mining rewards have historically declined - a trend that accelerated after the Reward Baseline was crossed down in Feb 2023. SPs using interest-rate protocols or lending services face increased risk due to the potential significant fluctuations in expected rewards. Our model, in contrast, is designed to minimize such exposure.
Current reward distribution scenario:
Note: Here is a simplified parameter for the initial launch of the Collectif Liquid Staking protocol and they're likely to change over time
The Collectif DAO native liquid staking token is Collectif Filecoin (clFIL). Users generate these tokens by staking their Filecoin (FIL) to the liquid staking pool. When the pool has sufficient FIL capital, Storage Providers (SPs) can pledge it as an initial pledge on the Filecoin network to bring on more storage capacity.
SPs regularly repay a part of their mining rewards to the stakers in the liquid staking pool, usually on a daily basis. The clFIL token serves as a yield-bearing asset. Unlike stETH from Lido, it doesn't rebase, meaning clFIL holders shouldn't expect their clFIL balance to change.
In its initial version, the liquid staking protocol won't allow withdrawals of funds currently locked in active miners. The protocol aligns with the Filecoin network structure and won't force the termination of existing sectors. For early redemptions, the Collectif DAO team plans to launch an Automated Market Maker (AMM) market, enabling the exchange of clFIL back to FIL.
Currently, our team is researching the possibility of allowing withdrawals through a scheduled queue system. However, this research is still ongoing.