Staking Module for Aethir

Protofire implemented a staking module based on the ve8020 model developed in collaboration with Balancer, then tailored to meet Aethir’s unique requirements for flexibility, security, and scalability. Drawing inspiration from the proven Balancer 80/20 pool architecture, the solution allows the majority of staked value to remain in ATH tokens while maintaining sufficient liquidity in stable assets. This approach not only reduces impermanent loss for liquidity providers but also creates a more stable environment for token holders, mirroring best practices from leading DeFi protocols.

The staking module is fully compatible with the ERC-20 standard, ensuring seamless integration with existing DeFi infrastructure and enabling future interoperability with other protocols. By leveraging ERC-20 interfaces, users can easily interact with the staking pools, claim rewards, and even utilize liquid staking derivatives for further yield opportunities within the broader DeFi ecosystem.

The solution features multiple staking pools tailored to different user profiles and ecosystem needs:

• Ecosystem Pool: Offers a competitive base APR and enhanced governance rights, structured using an 80/20 ATH-to-stablecoin model originally implemented at Balancer. This optimizes both reward distribution and liquidity.
• Container Pool: Provides dynamic APRs based on GPU utilization, incentivizing hardware providers and aligning rewards with real network demand.
• Checker Pool: Supports node operators with insurance staking and slashing protection, strengthening network reliability.

This modular, standards-based approach not only encourages users to lock their tokens and actively participate in governance, but also ensures that the system remains secure, transparent, and adaptable as Aethir’s ecosystem evolves. By combining innovative DeFi mechanics - such as smart contracts built on widely adopted protocols like ERC-20 and the ve8020 model - with a layered architecture that separates settlement, asset management, and user interaction, Protofire’s solution transforms passive ATH holders into active, engaged contributors. This lays the groundwork for a resilient and decentralized future, where security, interoperability, and user trust are maintained as the network grows.

The staking solution directly impacts several key metrics:

• ATH Tokens Staked: Over $20 million in ATH tokens locked within 90 days of mainnet launch.
• Sell Pressure: Significant reduction, as staking offers a compelling alternative to selling.
• Governance Participation: Increased from 12% to over 25% of token holders actively voting on proposals.
• Community Engagement: Elevated through gamified pools and achievement-based rewards.
• Number of Active Stakers: Substantial growth, with tens of thousands of unique addresses participating.
• Ecosystem TVL: Expanded rapidly, strengthening network security and stability.
• User Retention Rate: Improved, as yield and utility encourage long-term loyalty.

Protofire’s staking module, as deployed for Aethir, demonstrates several measurable advantages for projects in decentralized infrastructure, AI, gaming, and similar sectors. By enabling ATH holders to lock tokens for up to nearly four years and offering industry-leading sustainable rewards-currently up to 261% APR for 4-year staking-projects can incentivize long-term holding and reduce token sell pressure. This mechanism has resulted in a constant inflow of tokens into staking pools, directly supporting the stability and daily operations of Aethir’s decentralized GPU cloud.

The integration of liquid staking (stATH) further enhances token utility, allowing stakers to earn additional rewards across partner platforms and increasing engagement within the ecosystem. Weekly reward distribution and the eligibility for future airdrops from AI and gaming partners add further incentives for user retention and ecosystem participation.

For projects adopting a similar model, these features can:

• Increase staking participation, which in turn deepens token liquidity, enhances network stability, and strengthens operational security by ensuring a larger portion of the token supply is actively supporting the protocol.
• Offer sustainable, above-industry-average rewards (e.g., 195% APR for 3-year, 261% APR for 4-year staking).
• Enable flexible staking durations and liquid staking tokens, unlocking further DeFi integrations and cross-platform utility.
• Encourage long-term holding, reducing circulating supply and softening post-TGE sell pressure.
• Increase user engagement and retention through regular rewards, partner airdrops, and additional earning opportunities.