Yielding and staking are two methods of using crypto - one for earning a daily return and one for gaining Premium status and benefits - available to SwissBorg app users. Due to the high level of similarity between them, people often confuse one for the other.
To help you better understand what yielding and staking are and the key differences between them, we will now give both a closer look.
Earning a yield on crypto with SwissBorg
SwissBorg runs a program called Smart Yield, which enables you to put your cryptos to work and earn a yield every day. Anyone that holds a balance in a yield-eligible asset can put the entire balance or a portion of it into a Smart Yield wallet.
The yield is paid out every 24 hours, meaning that you are not only earning a return on your balance but also on the yield you acquired already.
Staking with SwissBorg
SwissBorg enables you to stake your CHSB tokens for a pre-defined period in order to upgrade from a Standard to a Premium account and enjoy benefits such as a yield boost and lower exchange fees.
When you stake tokens, you are essentially locking them up, meaning they are still in your account, but you can't exchange or withdraw them for the first 12 months.
After 12 months, if you want to stay Premium, you need to keep the CHSB balance locked. You will be free to exchange or withdraw your CHSB tokens but bear in mind that doing so will take you from a Premium account to a Standard one.
Yielding vs staking:
Only tokens held in Smart Yield wallets generate a daily return. The tokens staked are not eligible for generating a yield and therefore do not provide you with a daily return. Still, by staking CHSB and becoming a Premium user, you receive a yield boost, which means that you earn a higher yield on the tokens you are holding in Smart Yield wallets.
Staked tokens are locked for a minimum period of 12 months, during which they cannot be withdrawn or exchanged. On the other hand, funds that are held in Smart Yield wallets can be redeemed every 24 hours when the yield cycle is completed at 8 AM UTC.
Staking can only be done with SwissBorg's native token, CHSB, while Smart Yield allows you to earn a return on various tokens listed in the app.
For each Premium account type, there is a specific amount of CHSB that needs to be staked: 2,000 for Community Premium and 20,000 for Generation Premium. Smart Yield can be activated for as little as 10 EUR.
An important thing to note about staking:
Only staking CHSB gives you Premium status. Just adding the same amount of tokens required to become Premium to your CHSB Yield wallet does not upgrade your account.