Lesson 0 - How to Buy Alpaca and Start Earning Yields for Beginners(Lending+Staking)
This lesson is for beginners to Alpaca and BSC in general.
(*Note: This article is not financial advice, nor does it make any value judgments or trend analysis of ALPACA. It does not consider high-end trading strategies, currency pairs, LP TOKENs or leveraged mining. This is just a tutorial for beginners. Investing involves risks, so please be cautious when you enter any new positions. Thanks to Quant-Lion from the Chinese community for putting this together)
In this article, we will teach you how to buy ALPACA and how to Lend & Stake your ALPACA tokens on Alpaca Finance to earn up to 30% yields.
ALPACA can be purchased on the following centralized exchanges (CEXes) and decentralized exchanges (DEXes):
DEXes (on BNB Chain)
DEXes (on Fantom)
If this is your first foray into DeFi, your first step (and likely the most difficult step) will be to find a suitable "fiat onramp" platform, where you can deposit fiat currencies (e.g., USD, EUR, etc.) to buy cryptocurrencies.
For most users, the "fiat onramp" is a CEX (centralized exchange), such as the ones listed above, where users must register an account and undergo KYC. Fiat deposits are accomplished using bank wire transfers (e.g., SWIFT or ACH system), debit/credit cards (e.g. VISA or MasterCard system), P2P markets, or some other system.
Because there are ways to transfer cryptocurrencies between CEXes, you don't necessarily have to deposit fiat onto a CEX that has ALPACA listed. For example, you can deposit fiat into an FTX account, convert it to USDT, and transfer the USDT to a Binance.com account (via the Tron network for $1), where you can then buy ALPACA. Popular CEXes not listed above include Coinbase, Crypto.com, Kraken, Gemini, Huobi, OKEx, WazirX, Bitfinex, Bithumb, and Bitstamp.
Alternatively, there are a few decentralized protocols with an integrated fiat onramp. For example, on QuickSwap (Polygon Network), you can deposit fiat by credit card through Transak.
In summary, there are a multitude of fiat onramp options and they are constantly evolving, so you may have to research the most cost-effective and convenient option for you.
However, because BSC is tightly integrated with the Binance exchange, which as the world's largest exchange, has higher security and volume than other exchanges, we believe the simplest option to buy ALPACA is to register a Binance.com account and buy ALPACA on that platform. To do this, simply follow the steps:
- 2.Deposit Fiat. On Binance, go to "Buy Crypto" on the top right. You have three options:
- Credit/Debit Card - You can use your credit/debit card to buy various cryptocurrencies. ALPACA is not on this list, so we suggest purchasing BUSD, which is Binance's USD-pegged stablecoin.
- P2P Trading - This is a marketplace where you can use various fiat currencies to buy USDT using a multitude of payment methods.
- Third-party Payment - Binance offers three third-party payment channels: Simplex, Paxos, and BANXA. You will have to register an account with these third parties in order to onramp your fiat to Binance.
- 3.Buy ALPACA. On the top, go to Trade > Classic. Search for ALPACA in the search bar and you will see the available ALPACA trading pairs. ALPACA can be traded using USDT, BUSD, BNB, or BTC.
If you are located in a region where you can't open a Binance.com account, we suggest depositing fiat into a popular CEX used in your country. If that CEX doesn't have ALPACA listed, find a way to transfer stablecoins to a CEX that does (listed above). Or, transfer stablecoins to your MetaMask wallet configured to BSC (described next) so that you can buy ALPACA on one of the DEXes listed above.
A "wallet" is needed to interact with DeFi protocols and the most versatile and functional one is MetaMask. To buy ALPACA on a DEX or to lend & stake your ALPACA to earn 30% yields on Alpaca Finance, you will need to download and create a MetaMask wallet.
1. Download MetaMask and create a new wallet. MetaMask is a multi-chain wallet that runs as a browser extension on Firefox, Chrome, or Brave. Download it here: https://metamask.io/. Follow the instructions to create a wallet. Find a way to ensure you will never lose your seed phrase. Never give your seed phrase to any entity or person.
2. Add the BSC network to your MetaMask wallet. By default, MetaMask Wallet does not include the BSC network, so you will need to manually add it by following these directions: https://academy.binance.com/en/articles/connecting-metamask-to-binance-smart-chain
3. Deposit some BNB into your MetaMask wallet. BNB is needed in the wallet to pay for "gas fees," which are required to execute transactions on BSC. Buy some BNB (say $10 worth) on the CEX. Then, use the "withdraw" function to transfer BNB into your MetaMask wallet. Your MetaMask address can be copied by clicking the address displayed at the top of your MetaMask. An example address looks like 0xACD1f0827143502D0a763d2A23A24055DDD51023. For the "Network" option, be sure to choose “BSC Binance Smart Chain (BEP20)”.
4. Deposit ALPACA into your MetaMask wallet. Similar to the step above, use the "withdraw" function to transfer ALPACA into your MetaMask wallet. Every time you make a transfer to a new address, we recommend withdrawing a small amount for testing first. The withdrawal fee is just about USD 0.20, and takes about 10 minutes.
5. (If required) Buy ALPACA on a DEX. If you cannot purchase ALPACA on the CEX you registered with or if the CEX doesn't allow withdrawal of ALPACA to your MetaMask wallet, then you may have to purchase ALPACA on a DEX. To do so, use the "withdraw" function to transfer stablecoins (BUSD or USDT) from the CEX to your MetaMask wallet. Go to any one of the DEXes listed above, connect your wallet, and purchase ALPACA with the stablecoins in your wallet. As an example, we will describe how to purchase ALPACA with BUSD on PancakeSwap, the largest DEX on BSC: a. Visit exchange.pancakeswap.finance/#/swap b. Select BUSD (or whatever token you are trading for ALPACA) on the top of the swap interface. Select ALPACA on the bottom of the swap interface. When you select ALPACA, there may be additional prompts to Import the BEP20 token you chose. Click "Import".
c. Enter the amount of BUSD you wish to spend or the amount of ALPACA you wish to buy. The exchange rate will appear at the bottom of the swap interface. d. Click "Swap". A summary window of the transaction conditions will appear. If satisfied, click "Confirm Swap". MetaMask will then prompt you to confirm the transaction. Click "Confirm". ALPACA is now in your wallet. e. New tokens are not automatically viewable in your MetaMask wallet. You will have to manually add every token in your wallet to view its balance. To do this, scroll to the bottom of your MetaMask and click "Add Token". Enter the token address, which can be found on bscscan.com (search "ALPACA" and click its token address to copy it). Click "Next" and then click "Add Tokens". Now, you can see your ALPACA balance. (The first transaction will involve several additional actions, such as to approve the token. MetaMask will have a popup to allow PancakeSwap to access your wallet. For future transactions, these will not be needed.)
Once you have ALPACA in your wallet, you can now Lend OR Lock your ALPACA in our Governance Vault to earn up to 100% yields.
- In Lending, you will be lending ALPACA to users who wish to borrow them for leveraged yield farming. These borrowers pay an interest fee, of which you as the lender, earn the majority.
- In Locking your ALPACA, You’ll be able to choose how long you want to lock up your ALPACA tokens, from a minimum of 1 week to a maximum of 1 year. In return, you will receive xALPACA tokens which will represent your share in the governance rewards pool as well as your voting power for the upcoming governance functions in Q1 2022.The amount of xALPACA you’ll receive will be calculated based on the amount of ALPACA deposited and the remaining lock duration, where 1 ALPACA locked for one year = 1 xALPACA. Your xALPACA balance will decrease linearly over time and will reach 0 when it’s unlocked.The longer you lock up for, the more xALPACA you will receive, which translates into a higher multiple on your rewards APY and governance voting power.
- Connect your MetaMask wallet (make sure your network is set to Smart Chain)
- Click Deposit on the ALPACA vault
- Specify the amount you want to deposit and click Confirm
- After clicking Confirm, you should get a pop-up notification in your MetaMask to accept the transaction. Click Confirm and wait for the transaction to be processed. You may have to do this twice in order to confirm an approval if it's your first time depositing this asset.
- Once the transaction has gone through, you will automatically receive interest-bearing ALPACA (ibALPACA) in your wallet.
ibALPACA represents your share of the lending pool, and your lending interest automatically accrues into them. That is, the value of ibALPACA increases over time at the same rate as the Lending APR. This is how you earn the base lending interest. (See more info on ibTokens here). When you later withdraw, you’ll notice the value of your ibALPACA will have increased relative to ALPACA.
To lock ALPACA in the Governance vault, follow the steps below:
- Connect to your Web3 wallet (such as MetaMask) and make sure your network is set to Binance Smart Chain. Click here if you do not have the network in your wallet yet.
- Click "Create lock"
- Specify the details of your lockup
- Amount of ALPACA
- Lock duration
- Click "Confirm Lock" and you should get a pop-up notification in your MetaMask to accept the transaction
*By the way, lending and staking come with no deposit fees. But a certain amount of gas will be charged for each transaction on BSC, ~.20 USD-worth in BNB per transaction depending on BNB price