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Intro to Pickle Jars
How the magic jars work
- Pickle Jars sell off the reward token from underlying pools.
- It exchanges those reward tokens for more of the tokens comprising those pools.
- It then deposits those tokens back into the pool, compounding your returns.
Pickle Finance engages in several strategies, but most work in a similar fashion. In general, our strategies work by allowing a user to deposit their own funds into a liquidity pool, lending protocol, or staking mechanism. The user then deposits those tokens (representing their share of the liquidity pool or other asset) into a pickle jar. They will receive a pToken in return, representing their share of ownership over the jar. As the underlying strategies earn rewards, the pickle jar will claim and sell these rewards, exchanging them for more of the original asset, and depositing them back into the strategy. In this way, reward tokens compound your initial investment.
In general, users will not see their number of pTokens change at all, however, the number of underlying tokens representing their share of the liquidity pools will go up.