As explained above, Sushi can be staked (exchanged) for xSushi to earn a proportional share of the 0.05% of swap fees on Sushiswap. When Sushi tokens are staked, the equivalent USD amount of xSushi is minted. This newly minted xSushi is given to the staker in exchange for their Sushi. Therefore, the USD amounts of Sushi staked is equivalent to the amount of xSushi minted.

Holders of xSushi can convert their tokens back to Sushi. When they do so the xSushi token is burned. They receive the USD equivalent amount of Sushi in exchange for burning their xSushi. Burning xSushi can be thought of as unstaking Sushi.

The chart above shows daily amounts of Sushi staked and xSushi burned in the last 30 days.

The data refreshes daily.

The tokenomics of SUSHI can be broken down as follows²:

• 250 million SUSHI hard cap.
• 10% of all emissions go to the dev fund and the treasury.
• The expected date to reach the hard cap on Sushi emission is November 2023.
• There are currently less than 20 SUSHI tokens minted per block.
• The swap fees are distributed as follows: 0.25% to liquidity providers and 0.05% to xSUSHI holders

Sources:

1. The SUSHI bar, docs.sushi.com/products/yield-farming/the-sushibar#what-is-xsushi
2. SUSHI-nomics, docs.sushi.com/the-basics

In this post I provide a primer on Sushiswap's Sushi and xSushi tokens. I also track a few daily stats for each token.

Sushi is the native token of the SushiSwap exchange. Rewards to liquidity providers are paid in Sushi token. These rewards are taken from a 0.3% fee that is charged on all swaps between assets on Sushiswap.

Liquidity providers collect rewards using the 'harvest' function on Sushiswap. These haverst calls are recorded on Ethereum, which means we can track the amount of Sushi harvested by liquidity providers.

The Sushi token also serves a governance function. Owners can use it to vote on various governance proposals.

xSUSHI is a token received in exchange for staking SUSHI tokens. The xSUSHI token is always worth more than a regular SUSHI token, because xSUSHI accrues value from platform fees¹. When users make trades on the Sushiswap exchange a 0.3% fee is charged. 0.05% of this fee is used to increase the value of xSushi tokens. The remainder is paid to liquidity providers in the form of regular Sushi tokens.

What is xSushi?

What is Sushi?

Tokenomics

30-Day Stats on Sushi and xSushi

Here we see the collection (harvest) of Sushi rewards by liquidity providers. Rewards can be collected at any time. They do not need to be sent daily. Liquidity providers collect their Sushi rewards in infrequent and large chunks. Since transaction fees are paid to collect rewards, it makes sense to let Sushi rewards accrue for some time and collect them all in a single large transaction.

The chart above refreshes daily

Takeaways

• Sushiswap's native token is called Sushi. It is used to reward liquidity providers, to participate in governance and to fund the devs and the treasury.
• Liquidity providers collect Sushi rewards whenever they want by using the harvest function. Harvests are done irregularly and in large chunks. This may be a way to save on fees.
• xSushi is Sushiswap's second token. 0.05% of swap fees are accrued in the value of xSushi. To obtain xSushi, holders of regular Sushi must stake their Sushi in exchange for xSushi.
• Because of the way fees are distributed, the value of xSushi will always be higher than Sushi.
• Owners of xSushi can trade it back for Sushi by burning xSushi.

Takeaways