# Instant & Daily Yield with Stacking DAO

Stacking DAO’s architecture lets **users earn yield immediately** when minting **stSTX** or **stSTXbtc**—no 14-day wait, no idle cycles. 

**Rewards are distributed daily,** boosting the utility of liquid staking tokens and making them more versatile across DeFi.

Let’s explore how this works.

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### **REMINDER: How does the Stacking Process Work?** 

Stacks’ consensus mechanism, **Proof of Transfer (PoX)**, enables  miners to bid BTC to win new Stacks blocks and earn newly minted STX along with transaction fees.

The BTC they commit is then distributed to STX stackers as a reward for supporting network security.

Depending on the Liquid Stacking DAO product selected, rewards are delivered in **STX or** **sBTC**. See the FAQ for full details on how rewards are distributed.
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### How Stacking DAO Enables Immediate & Continuous Yield

There are three main mechanics behind this design:

<figure><img src="https://561486992-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FpR2O34qESrn0kvfaMx99%2Fuploads%2FcfKLfqXckdoUIvL5j7F9%2FPool%20(2).png?alt=media&#x26;token=b48e2abc-fe2f-4849-960d-5f25b4fe6568" alt="" width="563"><figcaption></figcaption></figure>

**1. Who Generates Rewards**

During **Cycle X**, rewards are produced by STX that’s already stacked via Stacking DAO.

Even if a user initiates the unstacking process, their STX remains locked and continues to earn until Cycle X ends.

New deposits made during Cycle X can't get stacked in that cycle but begin earning in Cycle X+1.

**2. The Common Rewards Pool**

All rewards generated during Cycle X can be treated as a shared rewards pool. This is what gets distributed daily to users in Cycle X+1.

**3. Who Receives the Rewards**

Rewards from Cycle X are distributed **daily** during Cycle X+1 and go to:

* Ongoing stackers
* New depositors (even if their STX isn’t yet actively stacked)

Users who begin unstacking during a cycle forfeit that cycle’s rewards, which are returned to the common pool and shared with remaining stackers.

<figure><img src="https://561486992-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FpR2O34qESrn0kvfaMx99%2Fuploads%2FJxXPgENl4Y8L6SZ2dLcJ%2FPool%20(6).png?alt=media&#x26;token=13e37f4c-678d-4d34-afd7-1b79dc253c51" alt="" width="563"><figcaption></figcaption></figure>

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### Why This Design Outperforms Other Solutions

Most stacking services delay rewards:

* Deposits must wait for the next 2-week cycle to get stacked
* Rewards are only paid at the **end** of a cycle
* Users can’t access or move STX mid-cycle

**Stacking DAO solves all this**:

* **Daily yield starts immediately**
* **Liquidity is preserved** via stSTX and stSTXbtc
* **No waiting period** to enter or exit

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### Summary: Immediate & Continuous Yield

**Immediate**\
New depositors start earning rewards from day one—even before their STX is actively stacked.

**Continuous**\
Rewards are streamed daily, using the previous cycle’s yield (Cycle X → distributed over Cycle X+1).

This makes Stacking DAO the only stacking service that aligns rewards with real-time DeFi participation—no delay, no friction