Yieldly’s TEAL 3 to TEAL 5 Staking Migration: The process explained
As promised, Yieldly’s TEAL 5 contracts are here! Yieldly is migrating from TEAL 3 to TEAL 5 staking contracts, ushering in a new (and improved) age of liquid staking on Algorand. With this major upgrade to TEAL 5, users will reap the rewards of our next-generation multi-asset, liquidity token and auto-compounding staking and more!
In today’s piece, we answer key questions about the migration process, namely:
- What’s changing?
- Why are the ALGO No-Loss Prize Games ending?
- Who does migration impact?
- What do I need to do if I’m impacted?
- When will migration commence and how will it work?
- What if I miss the migration week?
- I am not staking and holding my tokens on an exchange, do I need to do anything?
- Will I be paying fees for participating in this process?
- What’s the security like of the TEAL 5 contracts we are migrating to?
- Once migration is complete, what else can we expect from TEAL 5?
If you haven’t already, read our latest Developer Series which gives a deep dive into the design of Yieldly’s multi-audited TEAL 5 contracts. Plus, read our blogs on the excellent security audit outcomes with Halborn and Runtime Verification.
Now, without further ado, here is what you can expect leading up to and after the migration.
1. What’s changing?
We are leaving behind Yieldly’s TEAL 3 staking offering. This means:
We will be permanently closing Yieldly’s TEAL 3 YLDY→ YLDY pool (stake YLDY, generate YLDY and ALGO) and TEAL 3 ALGO→ YLDY pool (stake ALGO, generate YLDY and ALGO). This affects both the YLDY staking and ALGO no-loss prize game pools. It does not affect the NFT no-loss prize games. These two outdated pools — Yieldly’s TEAL 3 YLDY→ YLDY pool and TEAL 3 ALGO→ YLDY pool — will be replaced by a dual pool system:
- The new TEAL 5 YLDY/ALGO LP token → YLDY pool: Users stake partner LP tokens and are rewarded in Yieldly ($YLDY) for helping secure liquidity.
- The new TEAL 5 YLDY → YLDY auto-compounding pool: YLDY can then be staked to generate even more YLDY. With all our TEAL 5 same-token staking pools, you simply set and forget. A user’s stake automatically compounds from rewarded tokens over time without the need for claiming and restaking.
Whilst our much-loved NFT No-Loss Prize Games will continue in TEAL 5 form post-migration, our ALGO No-Loss Prize Games product will end due to Algorand’s governance participation awards ending (see Question 2 for an explanation).
All active TEAL 3 partner pools (XET, CHOICE, GEMS, SMILE) and their corresponding NFT no-loss prize game draws will continue unaffected by the migration. They will continue until their scheduled agreed-upon closure, as specified on our Dapp. Going forward, all new partner pools will leverage Yieldly’s TEAL 5 dual pool system: liquidity mining and staking pools.
2. Why are the ALGO No-Loss Prize Games ending?
Yieldly’s ALGO No-Loss Prize Games are ending as a corollary of Algorand Foundation’s governance. Why? Well, the way that our ALGO prize games operate is that all the ALGO staked into Yieldly’s smart contracts generates the weekly winning — this is thanks to network rewards. However, those network rewards have been declining each week because people are increasingly staking their ALGO in the Foundation’s governance, rather than on Yieldly. The numbers speak for themselves: compare Round 14’s 38k ALGO jackpot with Round 34’s 8k ALGO win.
Saying goodbye to Yieldly’s ALGO No-Loss Prize Games is no great loss for the ecosystem (except maybe for DENA, but we think they’ll cope). The community derived all the value possible from it when they could, with ~800K total ALGO in weekly winnings to date. It’s the inevitable reality that this product has now lost its utility in the current governance circumstances, as well as in view of our continued focus on delivering more community-centric products. To those who have staked in this v1 product, we thank you for your help in making it the success it was.
A rising tide should lift all boats and we will continue looking for opportunities to launch products that are more beneficial to the community as a whole.
3. Who does migration impact?
The migration impacts anyone who currently stakes in Yieldly’s TEAL 3 YLDY→ YLDY pool (NFT No-Loss Prize Game) and TEAL 3 ALGO→ YLDY pool (ALGO No-Loss Prize Game).
4. What do I need to do if I’m impacted (as above Question 3)?
Yieldly will be migrating the rewards — not user tokens, of Yieldly’s TEAL 3 YLDY→ YLDY pool and TEAL 3 ALGO→YLDY pool.
You will need to move your own tokens from those TEAL 3 pools to the new TEAL 5 YLDY/ALGO → YLDY LP staking pool and TEAL 5 YLDY → YLDY auto-compounding pool. Please note that if you wish to participate in our TEAL 5 LP pools, you will also need to obtain the relevant LP token from Tinyman.
5. When will migration commence and how will it work?
We are targeting a migration and subsequent launch that is at least 30 days from today, giving the community ample notice for migration.
We anticipate that migration will take a week (7 days). Migration will involve the creation of the two aforementioned TEAL 5 pools (refer to question 1) . Every day, a ratio of YLDY rewards will be migrated over to the new TEAL 5 pools. At the end of the migration, no more rewards will be emitted by the old pools. Migration ends once all rewards have been transferred from TEAL 3 to TEAL 5 contracts.
6. What if I miss the migration week?
All stakes that have not been migrated to the new pools will simply stay in the inactive TEAL 3 contracts. They will not generate any rewards until they have been migrated to the new TEAL 5 contracts. Yieldly will continue to support withdrawals in those inactive contracts until there are no more user tokens remaining.
We strongly encourage you to get involved in this process as soon as migration commences so that your rewards will continue accruing.
7. I am not staking and holding my tokens on an exchange, do I need to do anything?
No, you don’t have to do anything.
8. Will I be paying fees for participating in this process?
Only Algorand’s network fees will apply. Please ensure that you have enough ALGO in your wallet to complete withdrawing and re-staking your tokens and opting-in to the new smart contracts.
A method of clearing/closing out of the TEAL 3 pools will be recommended by us in due course. Please do not use third parties (ie. algodesk) to do so as we cannot guarantee your account states will not be impacted.
9. What’s the security like of the TEAL 5 contracts we are migrating to?
Security is of the utmost importance for Yieldly — it took countless hours of internal and external testing for us to feel comfortable with launching our TEAL 5staking contracts.
Our security process included:
- A full-length multi-token staking audit from Runtime Verification
- A full-length multi-token staking audit from Halborn
- A full-length auto-compound same token staking audit from Halborn
10. Once migration is complete, what other TEAL 5 pool products can we look forward to?
As explained in our last Developer Series, Yieldly’s next generation contracts deliver far more variety and choice for our community. In addition to the TEAL 5 pools we are migrating to, we intend to deliver the following pool models thereafter:
1. Partner LP and staking pools:
A dual pool system, see our Akita Inu pools as the inaugural example. Users stake partner LP tokens and are rewarded in YLDY for helping secure liquidity for the ecosystem. YLDY can then be staked in a separate pool that yields the partner’s token. These complementary pools will always be released concurrently for the same duration.
2. Community staking pools:
Similar to the described product above, but with the added bonus that it’s up to the community. Our governance program empowers users to elect which ASA projects they would like to see in the Yieldly ecosystem. Community pools will be clearly identified on Yieldly’s Dapp, so users can distinguish between pool types and stake at their discretion.
3. Fair distribution pools:
As part of Yieldly’s role as an ecosystem incubator, these pools provide fair ways for other ASA projects to distribute their tokens over time.
Get ready for a new age of staking.
Yieldly will be sharing updates as we approach the time of migration. As always, get involved and stay up to date via our socials:
