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H2O Savings Pool

Savings Pool Mechanism

H2O holders can stake their H2O into the Savings Pool smart contract at any time. Once staked, H2O continuously accrues as a reward, based on the current H2O Reward Rate. Also, the savings pool may have MELT as rewards at the same time.
The Savings Pool smart contract has no withdrawal limits, deposit limits, or liquidity constraints. Users aren’t required to deposit a minimum amount to earn the interest, and they can withdraw any or all of their H2O from the Savings Pool contract at any time.
Please note that holding H2O does not automatically earn the interest in H2O. It only does once it is deposited into the Savings Pool smart contract.
The H2O Savings Rate (APR) is a variable rate of accrual earned by staking H2O in the Saving Pool smart contract. H2O holders can earn savings automatically and natively while retaining control of their H2O. The H2O reward is actively set by the MELT governance mechanism. The H2O Savings Pool is also a monetary policy tool used by Defrost Finance governance to influence demand for H2O.
The displayed rate is what a user would earn on their principal in one year, at the current emission rate. For example, if the H2O Savings Rate is 1% and a user deposits 100 H2O they can expect to have 101 H2O in 1 year.

H2O Savings Pool as a Monetary Policy Tool

The H2O reward in the H2O Savings Pool is a global parameter that can be raised or lowered to influence demand for H2O. Raising the H2O Savings reward incentivizes users to hold more H2O, leading to higher demand for H2O, whereas lowering the H2O Savings reward has the opposite effect of reducing demand for H2O.
This is reflected in the spot market price of H2O; if H2O is trading below a dollar, then the H2O Savings reward can be raised to increase demand for H2O which would bring up the price of H2O. Conversely, if H2O is trading above a dollar, then the H2O Savings reward can be lowered to reduce the demand for holding H2O which may help bring down the price of H2O.

Current Emission

H2O emission: 330 H2O/day
MELT emission: 723 MELT/day