We’re excited to announce a major enhancement to Smart Savings, now supercharged with liquid staking, unlocking a new dimension of flexibility, liquidity, and capital efficiency for your assets. With this upgrade, you can now enjoy the native yield on Smart Savings while maintaining the full functionality of your assets, allowing you to make the most of your capital without compromising on growth opportunities.

In our initial release, Smart Savings brought chain-agnostic gas payments, native yield, full withdrawals, and instant liquidity. Now, with liquid staking, we’re elevating these features by adding four core features: liquid staking tokens, seamless omnichain deposits, withdrawals, and spending, a real-time Net Asset Value (NAV) tracker, and a liquidity pool for instant withdrawals, bridging the gap between rewards and versatility, empowering you to make the most of your assets. 

What’s New? 

1. Liquid Staking Tokens

Users can now mint liquid staking tokens (LSTs), atUSD and atETH, that steadily accrue value over time. These LSTs are ERC-20 tokens that represent your Smart Savings position and are tied to your share of assets in the DeFi vaults. atUSD corresponds to the USD stablecoin vault, while atETH is linked to the ETH vault. In simpler terms, think of these tokens as your “Certificate of Deposit” after making a deposit into Smart Savings. 

By minting LSTs, you earn yield and unlock liquidity, enabling you to freely utilize your assets across the DeFi ecosystem without sacrificing capital efficiency. As Smart Savings generates yield, the value of atUSD and atETH increases in parallel, reflected in a rising atUSD/USDT or atETH/ETH exchange rate. This rate determines how much USDT or ETH you’ll receive when redeeming (burning) your tokens. 

E.g., on Day 1, the atUSD/USDT exchange rate starts at 1:1 (burning 1 atUSD gets you 1 USDT). After generating yield, on Day 2, the exchange rate rises to 1:1.05, meaning burning 1 atUSD will now get you 1.05 USDT.

2. Omnichain Deposit, Withdraw, and Spend – Powered by Gravity

The enhanced deposit and withdrawal process introduces two pathways: 1) the primary market for minting and burning LSTs, and 2) the secondary market for buying and selling these tokens via DEXs. The primary market is ideal for handling large deposits and withdrawals, while the secondary market is more efficient for smaller, day-to-day transactions. This is further accompanied by an auto-router function that guides users toward the most efficient path (primary vs. secondary). 

Let’s break it down. 

Depositing Funds:

• Primary Market: Deposit funds on Ethereum → mint LSTs on Gravity

• Secondary Market: Deposit funds on any supported EVM chain → bridge to Gravity → swap for LSTs on a DEX

Withdrawing Funds:

• Primary Market: Burn LSTs on Gravity → initiate withdrawal and wait for the standard countdown (T+7) → claim your funds on Ethereum

• Secondary Market: Swap LSTs on a DEX for USDT or ETH (T+0) → bridge back to any supported EVM chain 

Spending Funds: 

When it comes to spending your funds on Smart Savings, such as for NFT minting, Galxe will cover the upfront cost on your behalf and then receive reimbursement from your balance. This is pre-authorized for your convenience, ensuring a seamless payment process.

3. Net Asset Value (NAV) Tracker

The Net Asset Value (NAV) tracks the real-time intrinsic value of LSTs (atUSD & atETH), reflecting both the principal capital and the yield generated. This ensures a fair distribution of the accrued yield among all holders of atUSD and atETH.

E.g., on Day 1, if 1,000 atUSD are minted, corresponding to an underlying DeFi Vault valued at $1,000, the NAV of each atUSD would be calculated as: 

$1,000 (NAV of the underlying DeFi Vault) / 1,000 (Total Supply of atUSD) = $1.00 

On Day 2, if the NAV of the DeFi Vault increases to $1,005, with no change in total atUSD supply, the NAV of each atUSD would be calculated as: 

$1,005 (NAV of the underlying DeFi Vault) / 1,000 (Total Supply of atUSD) = $1.0005

This results in a realized yield of 0.5%.  

NAV serves as the exchange rate for the minting and burning of atUSD in the primary market. So, on Day 2, depositing $1.005 would mint you 1 atUSD, while burning 1 atUSD would redeem $1.005. 

Following this example, when the NAV of atUSD is $1.005, market arbitrageurs will drive the secondary trading price of atUSD toward its NAV value. If atUSD trades above NAV (say, at $1.01), an arbitrageur can mint 1 atUSD for $1.005 and sell it for $1.01, pocketing a profit of $0.005 in real-time. This selling activity will subsequently push the price of atUSD back down to its NAV. Conversely, if atUSD trades below NAV (for instance, at $1.00), the arbitrageur can buy 1 atUSD for $1.00 and burn it to redeem $1.005 based on the NAV, realizing a profit of $0.005. Such buying activities will drive the price of atUSD back up to its NAV.

4. Liquidity Pool for Instant Withdrawal 

atUSD/USDT and atETH/ETH DEX pools are now live on Camelot DEX within Gravity to facilitate the secondary market deposit and withdrawal process outlined above. These DEX pools have been carefully sized to maintain a liquidity ratio of 10% of the underlying DeFi Vault's Total Value Locked (TVL). Additionally, the price ranges of these pools are dynamically adjusted to ensure minimal slippage, complemented by a rebalancing mechanism to optimize token ratios within the DEX pool. 

In the unlikely event that the DEX pool’s liquidity is exhausted and remains below its functioning levels, the secondary market deposit and withdrawal process may be temporarily suspended. During such times, you have two options for withdrawals: you can wait for the DEX pool to be refilled, allowing for instant withdrawals (T+0), or you can utilize the primary market by burning your liquid staking tokens and claiming your funds after the standard waiting period (T+7). 

Getting Started on Smart Savings

With this upgrade, Smart Savings delivers a smarter way to manage your assets, merging yield generation with flexibility for liquidity and capital efficiency. Here’s a look at the supported networks and tokens on Smart Savings: 

For a step-by-step guide on depositing and withdrawing your assets on Smart Savings, check out our Help Center article here. Ready to unlock the full potential of your assets? Start exploring Smart Savings here.