There are three ways how Electra Protocol investors can earn with their holdings, independent of just selling tokens on an exchange. 1) You can use your XEP coins and stake them in return for up to 3% XEP APY. 2) You can provide WXEP tokens and join a liquidity pool on the Binance Smart Chain for a dynamic return between 5% and 25% APY. 3) You can run a XEP validator node (upcoming during 2022).
Electra Protocol decided to issue a Wrapped XEP token on the Binance Smart Chain, so that users familiar with that blockchain can easily trade and earn. PancakeSwap allows users to trade such tokens and earn rewards for providing liquidity to the Wrapped XEP tokens they provide.
Wrapped XEP have the same value that XEP coins, but they are technically not compatible. If you want to use native XEP coins on PancakeSwap, you have to first convert XEP to WXEP and then transfer them to your WXEP wallet, such as MetaMask.
A liquidity pool is a collection of funds locked in a smart contract. Liquidity pools are used to facilitate decentralized trading, lending, and many more functions.
Liquidity pools are the backbone of many decentralized exchanges like PancakeSwap. Users called liquidity providers (LP) add an equal value of two tokens in a pool to create a market. In exchange for providing their funds, they earn trading fees from the trades that happen in their pool, proportional to their share of the total liquidity.
Liquidity pools are a significant innovation that allows for on-chain trading without the need for an order book. As no direct counter-party is needed to execute trades, traders can get in and out of positions on token pairs that likely would be highly illiquid on order book exchanges.
Anyone who invests in XEP on the Binance Smart Chain (WXEP tokens) can use these tokens in liquidity pools. In return for adding XEP in a PancakeSwap liquidity pool, rewards are paid out, which vary depending on market situations.
The PancakeSwap transaction fee is 0.2%, with 0.17% of that going to liquidity providers. If you need more detailed instructions on how to add or remove liquidity and earn with it, please follow these detailed guidelines.