Benqi is a decentralized liquid staking protocol, allowing anyone to earn yield on their AVAX by delegating their tokens to a network of blockchain validators.
Benqi allows users to earn staking rewards without locking assets or maintaining staking infrastructure. Users deposit their AVAX into Benqi's smart contracts and receive sAVAX in return that represent an active balance of the user's staked AVAX along with any staking rewards accrued or penalties inflicted on validators. Users can withdraw or redeem their sAVAX back for their original AVAX at any time, but must wait the 15 day unbonding period before claiming.
Benqi generates revenue by charging a 10% fee on the staking rewards earned by depositors. This fee includes the delegator fee paid to the underlying validators. As such, the protocol's revenue is driven by the fee charged, the amount of assets staked, and the yield earned by validators.
Passive AVAX holders can generate additional yield by participating in the PoS validation mechanism to earn block rewards. The unlocked liquidity with sAVAX can also be used on a number of popular DeFi protocols to generate additional yield.