Voting for Stake pools

There is a democratic process in place for liquidity providers to decide in which Stake pool the whole ADA amount in the Liquidity pool will be delegated.

How voting works

There is a separate voting for each ADA Liquidity pool, which means that every ADA Liquidity pool on WingRiders can delegate its ADA to a different Stake pool. A single ADA Liquidity pool can be delegated to a single Stake pool.

Each Liquidity Provider Token is counted as a single vote. Users have to deposit their LP tokens if they want them to use for voting. You can decide how many of your LP tokens you want to deposit - the more you deposit, the bigger your voting power will be. Keep in mind that deposited LP tokens are locked in a smart contract and they won't be available at your disposal until you withdraw them.

The deposited tokens are shared between farms and voting. See below.

At the end of each Cardano epoch, the voting results are summarized and ADA from the Liquidity pool is staked to the winning Stake pool in the next epoch.

What is your voting power

Your voting power is the minimum of your deposited LP tokens in a given epoch. What does this mean in practice? Let's say you deposit 100 of LP tokens for voting in the middle of epoch 335. Your minimum deposited LP tokens in epoch 335 will be 0, thus you will have no voting power in this epoch. If you keep your 100 LP tokens deposited, your minimum deposited LP tokens in epoch 336 will be 100, which means your voting power in epoch 336 will be 100 and you will have a chance to change where the ADA from the Liquidity pool will be delegated.

If you would have withdrawn your 100 LP tokens in epoch 336, your minimum deposited LP tokens in epoch 336 would drop to 0 and you would lose your voting power.

In case you've removed 20 LP tokens in epoch 336, your minimum deposited LP tokens and voting power would be 80 for the epoch.

To sum up, you have to keep your LP tokens deposed for the whole epoch to have voting power.

Changing your preferred Stake pool

If you deposit your LP tokens and vote for a Stake pool but later you decide that you want to change the Stake pool you can easily do so in the application. In this step, you won't be able to change the number of deposited LP tokens, you can just change your preferred Stake pool.

In this scenario, your minimum deposited LP tokens in the current epoch will not change and your voting power in this epoch will be the same.

Depositing your LP tokens to a farm vs using them for voting

Depositing your LP tokens to a farm and depositing them to vote is technically the same thing. We don't want users to lose on farming rewards if they want to vote for a Stake pool and vice versa.

This means that if you deposit your LP tokens to a farm you automatically gain the opportunity to use your deposited LP tokens for voting, you just need to select your preferred Stake pool (apply your vote).

Keep in mind that this goes both ways. If you withdraw your LP tokens from voting in a Liquidity pool that has a farm, you will lose your farming rewards.

Minimum voting participation

In order for the voting results to change the Stake pool where ADA will be delegated, the voting participation must be at least 15%. This means that at least 15% of all issued LP tokens for the Liquidity pool have to participate in voting. If the participation drops below this minimum, default stake pool will be selected again.