How to Supply Assets
- 1.Connect your wallet to the Lending Network
2. Select one of the available Supply Markets on the left side of the screen by clicking on the token name/logo. In this example, we supply BABY. (Make sure you are on the MARKETS tab).
3. On the Supply tab, approve BABY as collateral.
4. Click on BABY and enter the number of tokens you wish to Lend, or select from the percentage buttons below. Note the Supply APY (payable in the deposited currency) and the Distribution APY (payable in BABY).
5. Click Supply at the bottom of the popup. If this is your first time supplying an asset, you will have to approve the token first.
6. Done! Now you have successfully become a lender!
After depositing your tokens, the pool will mint oTokens - or "receipt tokens" - and credit you. These oTokens show that you have supplied assets to one of BabySwap Lending Networks. When you go to withdraw your tokens from the supply side, the system will ask for those oTokens back - so make sure you hold on to them!
The conversion rate from oTokens to the deposited token absorbs the interest that borrowers pay. This means that when you withdraw your tokens, you will receive more than you started with, proportional to the token's APY. It is important to note that APYs in BabySwap are floating and not fixed. Rates get updated on a per-block basis and can fluctuate significantly within relatively short time spans. Rates that lenders receive are determined by the rates that borrowers pay.
Let's walk through an example. Say you deposit 10 ETH with an average APY of 5%. First, you will notice that your wallet now has 10 ETH worth of oETH in it - these are your receipt tokens. When you go to withdraw your ETH after 1 year, you will trade back the oETH and receive 10.5 ETH in return (your original 10 ETH plus the 5% APY).
Last modified 4d ago