XDGN
Staking dragonfinance.co (DGN) tokens rewards you with xDGN, the Dragon Finance protocol's governance token.
What is xDGN?
xDGN is a utility token for the Dragon Finance protocol. You must hold xDGN in your wallet to be able to vote on decisions that will shape the future of Dragon Finance. The more xDGN you hold, the more power your vote will carry.
How Does xDGN Work?
DGN can be exchanged to and from xDGN at any time on our xDGN page.
When xDGN was launched, the ratio of DGN to xDGN was exactly 1.0. At a ratio of 1.0, if you deposited 100 DGN, you would receive 100 xDGN in return. And, similarly, if you redeemed 100 xDGN, you would receive 100 DGN back.
xDGN is only minted when DGN is deposited into the contract. Any time DGN is sent to the xDGN smart contract as rewards, it will increase the ratio of DGN to xDGN, generating a yield for all xDGN holders.
Example
John deposits 10,000 DGN into xDGN staking, when the exchange is 1.0. John receives 10,000 xDGN in return for his 10,000 DGN.
Other users stake a combined 90,000 additional DGN, making the total staked amount of DGN 100,000.
Now we have 100,000 xDGN in total, and 100,000 DGN in the xDGN staking contract.
10,000 DGN are now sent to the xDGN reward contract, making the total amount of DGN in the contract 110,000 now (learn where DGN rewards come from below).
Since the total amount of xDGN is still 100,000, but the DGN shared among stakers is 110,000, the exchange rate (ratio) will now be 1.1 DGN per xDGN.
John can now redeem his 10,000 xDGN to receive 11,000 DGN in return.
Any new DGN deposits at this point will receive xDGN at the current exchange rate of 1 xDGN per 1.1 DGN (as per this example).
Contract
The xDGN contract can be found here: 0xBF9805003c95d5EE8B07fB4B0D9c6004CE39c64B
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