It is exciting news: the PowerPool team takes an interest in automatized yield harvesting and the subsequent re-investing of staking tokens to generate value. Now, imagine if PowerPool made use of an "xToken" such as xINCH xAAVE or xKNC and develop a structured investment product around it. Eager to get to know more?
What is xToken?
xToken is an ecosystem of xTokens, comprised of simple vaults of a specific token. Take 1INCH as an example: xINCH is the result of harvested 1INCH governance token staking rewards, which in consequence are readded to the main staking position, compounding yield and saving gas costs (that could be spent on this operation, the addition of rewards to the main position, if done seperately).
As of Apr. 30th 2021, the PowerPool team has had discussions with xToken's team on possible ways of integrations.
One proposal of how that could be done is that xTokens could be used as components of PowerPool products to allow for these auto yield compounding building blocks to allow for capital-efficient structured investment products for PowerPool users.
Should xTokens considered being added to PowerPool products?
The PowerPool team deems it worthy, yes. For two reasons: the first being that an integration would boost TVL in PowerPool and the second being an enhancement in user experience both for users of xToken as well as PowerPool users.
What lies ahead?
PowerPool will proceed to establish a partnership with xToken. Subsequently xTokens will be added to new PowerPool investment vehicles where it is possible taking into account technical specification and parameters of Dynamic Automated Market Maker (DAMM) strategies.
Resulting in new ways to utilize underlying assets of each xToken.
Resources:
(1) Proposal 34 - Ecosystem partnership with xToken & using xToken as a building block - Proposals - PowerPool
(2) xToken Market