Instant Unstake
What is instant unstake?
Polkadot DOT and Kusama KSM take 28 days and 7 days respectively to unstake and make the tokens transferable again. During that waiting period, your tokens are locked and inaccessible. This means if you have the sDOT/sKSM, it takes a long time to convert them back to DOT/KSM in order to regain full usage of your liquidity.
Instant Unstake is a feature that allows users to unstake their token and receive their DOT/KSM instantly without the typical mandatory waiting period for a small fee. Users can utilise instant unstake if they want to unbound without any delays and make full use of their liquidity.
What is the benefit of Instant Unstake?
Instant Unstake allows users to fully exit their staked position without the typical waiting period. While user can swap their sDOT/sKSM back to DOT/KSM on Parallel AMM, there is slippage that must be taken into consideration (especially when swapping huge amounts of tokens). Therefore if a user wishes to instantly convert a large amount of sDOT/sKSM to DOT/KSM, instant unstake allows users to exit their position with a more cost effective approach.
Why is there a fee to use Instant Unstake?
Instant Unstake works by using Money Market in order to provide the user with an advance of the unstaked amount in DOT/KSM. This is done via a loan of DOT/KSM for the entire duration of the unstake process, therefore interests would be charged for the loan. The fees charged for instant unstake goes toward liquidity providers who lent their DOT/KSM on Money Market.
Last updated