The core function of the POLAR token is to allow users (stakers) to gain additional reward multipliers on their harvests by spending POLAR at the point when the rewards are harvested and the stake withdrawn. These are ontop of the time-based reward multipliers.
This "gamifies" the yield farming process by allowing users with smaller stakes to compete with those with larger ones.
Here's an example of how the POLAR token works in practice:
Let's say User A and User B are both staked in a Supernova pool for the same period of time.
User A has $1000 of tokens staked for 15 days
User B has $500 of tokens staked for 15 days
After 15 days,
Total rewards accumulated in the supernova reward pool is $450 based on a 730% APR%
User A has accumulated a harvest reward of $300 reward tokens from his staked tokens
User B has accumulated a harvest reward of $150 reward tokens from his staked tokens
These shares are the same as they have the same time bonus based on their stakes' durations. Different durations would have resulted in different shares
The competitive Supernova dimension means that stakers can earn more or less than these rewards based on their staking strategy and by spending Polar:
When User B prepares to unstake, he has the option of spending POLAR to gain a bonus multiplier on his rewards. Let's say he spends 1,000 POLAR for a 1.4x on his rewards.
Now, User B unstakes and receives $210 worth of reward tokens (the extra rewards comes from the total reward pool reducing rewards for other stakers).
So if User A then unstaked he would only receive and receives $240 of rewards.
In addition to this utility, Polar can effectively be used as a 'financial option' over the underlying reward tokens being farmed. If one of the reward tokens has risen in the market more than another, then it would be worth spending more Polar on this farm for the more valuable rewards.
The 1,000 POLAR that User B spent is locked into the Supernova contract, and can be withdrawn by the pool creator. When the tokens are withdraw, half is burned and the other half goes to the pool creator and can be used for project development funds.