What Can You Do with Wrapped Tezos?
Are you thinking about diving into Tezos Defi? Maybe you don't want to risk having your XTZ liquidated? Wrapped Tez may be just what you need to get started.
For every XTZ you hold, you are eligible to borrow 1 Wrapped Tez (wXTZ). Wrapped Tez are loaned interest-free, and your underlying collateral (XTZ) can never be liquidated!
In fact, you can receive your full baking rewards from any baker you choose for the XTZ you borrow against, and those baked rewards are yours to do with as you please.
To unlock your XTZ principal, all you have to do is burn 1 wXTZ for each XTZ you want to withdraw.
Give me some examples:
So let’s say you are holding a bag of 1000 XTZ. You can deposit those XTZ in the wrapping contact, select your baker of choice and just let them bake. You now automatically have 1000 liquid wXTZ that are ready for some Tezos DeFi action!
Become a DAO Member:
Maybe you want to go big and become a DAO bag holder. There are a growing number of DAOs on Tezos that you can get involved in. Trade your wXTZ on Quipuswap or Dexter for
hDAO — The DAO token for Hicetnunc.xyz
STKR — The DAO token for StakerDAO
WRAP — The DAO token for Wrap Protocol.
All three of these platforms are fast-growing revenue-generating services that are looking for community members to get involved in their day-to-day governance.
Become an Art Collector:
Tezos is becoming quite the scene for NFT art projects. Trade your wXTZ for XTZ on Quipuswap or Dexter and start collecting at Hicetnunc.xyz or Kalamint.io
Take out a USD denominated loan that can’t be liquidated.
Need some cash to pay bills, or want some funds on the side to buy the next dip? With wXTZ, it’s easy to swap for USDtz, SUSD, wUSDC, wUSDT and kUSD. Regardless of how XTZ moves, you will never get liquidated by holding those stable coins. And wUSDC, wUSDT and USDtz can all be bridged to ethereum to have access to a fiat offramp.
Become a DeFi Farmer (coming soon in the following weeks!):
Let me introduce a new concept: Stacking Yield. Stacking Yield is when you have one base asset, and you are able to transform it several times to dramatically increase the yield you get off it. Wrapped Tez is the perfect tool for Stacking Yield. Check this out:
Step 1: Put your XTZ in the Wrapped Tez vault and earn your regular Baking yield (6%)
Step 2: Borrow wXTZ and become a liquidity provider to the wXTZ / XTZ trading pair on Quipuswap and get a share of every trade made from that pair (10% — 20%) annually.
Step 3: Take the LP token for that trading pair and stake in in the StakerDAO Farms. Staking the LP token generates STKR yield, and can produce returns of 100%+ depending on the parameters of the farm.
Go “Full Degen” on Tezos
There are a growing number of meme coins launching on Tezos, and a fair number of those have defi farms available to them. While being a degen might get you rekt, it might also produce some crazy returns. By using your wXTZ to go full degen, you are protecting your XTZ in your vault, and even if you lose your wXTZ today, you can buy some back in the future. Only you can unlock your vault, so your XTZ will be there baking away until you need them.
As always, I am working to get Decentralized Finance to the people, not just the 1%. Blockchain and decentralization can break up our capitalist system, so let’s talk about it. Feel free to dm DeFi Comrade on twitter to chat more.
