Users of the Dash cryptocurrency will soon have a ramp to access Decentralized Finance applications through a partnership with StakeHound.
The functionality will allow Dash users to interact directly with DeFi applications and earn staking rewards with the cryptocurrency – according to an official statement from StakeHound. The partnership includes DASH NEXT and the Dash Core Group.
StakeHound is a platform that allows users to stake a variety of cryptocurrency tokens that already DeFi compatible by creating ERC-20 tokens that are backed by the users’ cryptocurrency.
A major focus of the partnership will be the creation of stakedDASH which will form a bridge between DASH and the Ethereum DeFi ecosystem. Dash holders will be able to stake their tokens and earn yield through a number of major DeFi platforms as well as general staking rewards.
StakeHound wraps Dash
Given that a large majority of DeFi applications are currently built on the Ethereum blockchain, this essentially requires users to stake ETH or other ERC-20 tokens in order to participate in various DeFi products.
As it currently stands, Dash users are not able to stake their tokens in DeFi platforms running on the Ethereum blockchain. However StakeHound is providing a solution to this problem by wrapping DASH tokens in an ERC-20 version called stakedDASH. The platform stakes the tokens and runs masternodes for users which gives them a 1:1 representation of their given token – in this instance for DASH users.
Dash users will send their DASH tokens to StakeHound, which is then wrapped before the user receives a 1:1 ratio ERC-20 token of their DASH called stakedDASH. The platform stakes the tokens it receives and distributes rewards to users in additional stakedDASH tokens.
These tokens will be able to interact with various DeFi applications which includes Uniswap, Aave, Curve, Synthetix and more. Users can start staking with just 1 DASH token
When a user wants their original DASH tokens back, they simply swap out their stakedDASH for their original tokens.
Access to major DeFi products
The release also outlines the various ways in which stakedDASH can be used within the DeFi ecosystem. Holders can partake in yield farming by providing liquidity to DeFi platforms. It can also be used to lend or borrow against stakedDASH tokens.
StakeHound also issues stake-backed tokens on both Ethereum and Radix blockchains which will essentially allow users to interact with different DeFi ecosystems – due to built in cross-ledger functionality.
There is no official release date for the availability of stakedDASH other than saying it will be launched later this year.