Introduction to the Pastel Network

This relatively new layer-1 blockchain is focused on supporting NFTs. This project was forked from Animecoin (ANI). This purpose-built blockchain touts the following features:

• Negligible fees

Pastel network's dynamic fee mechanism results in negligible transaction fees both on- and off-chain. This aims to reduce friction from other general-purpose layer-1s.

• Certifiable authenticity

Their industry-leading near-duplicate NFT detection technology helps to identify counterfeits, protect IP and certify the rarity of your digital property.

Their blockchain also features:

• Reliable storage - abundant and distributed systems for permanent storage
• Cross-chain interoperability
• Permissionless open network of peer-to-peer nodes
• Scalability
• Security - due to the multi-layer architecture

All the good stuff.

To boot, the native Pastel (PSL) coin features a proof-of-burn consensus mechanism.

WTF is that you say? First, let's have a look at the tokenomics.

Pastel (PSL) Tokenomics TLDR

Current price (6th July 2022) - $0.00069

Market cap - $1,761,687 (shitcoin territory, but much room to grow)

Max supply - 21,000,000,000 (billion - the Bitcoin maxi within me is screaming 21 million)

Circulating supply - 2,530,716,531

Total supply - 10,970,123,578

(Just FYI => Total supply = On-chain supply - burned tokens)

Emissions schedule - 6,250 PSL created per block, target time of 2.5 minutes per block. The block rewards are halved every 840,000 blocks.

Consequent inflation - targeted to be ~12% at genesis and should decrease to under 1% over time due to PSL deflation.

Block rewards distribution:

• SuperNode Operators - 20%
• Miners - 80%

So no pre-mining or insider distribution mentioned in the documents.

Deflationary mechanism - proof-of-burn

If this sounds unfamiliar, don't worry it was new to me as well. There are more consensus mechanisms out there than you can shake a stick at.

Fixed and Variable fees - these are charged to users during network message executions.

Fixed fees are incurred by users during transactions using minimal computational effort, these fees help to deter attackers or bots from spamming the network. Fixed fees are generated from and burnt following:

• Creation of a Pastel ID (1000 PSL)
• NFT registration (10 PSL)
• NFT trading (1 or 2% of the offer or asking price respectively)

Variable fees are charged to users, the amount varies with the computational effort required to carry out:

• NFT activation (3 or 50 PSL for space or storage respectively)
• Sense API (1 PSL)
• Cascade API (50 PSL)

Variable fees are either burnt or distributed to Supernodes.

The full list of fees can be seen in resource 3.

Nodes, staking and where to buy

As the old cliche goes, this is not financial advice.

You can currently buy and stake the PSL token on KuCoin (42% APR) - receiving the same rewards as a full PSL Supernode. You can stake between and including 1000 - 1,000,000 PSL ($0.70 - $700 for a single user). Staking rewards can be claimed every 24 hours. Full details can be seen in resource 4.

See the main website (resource 5) if you are interested in running a Supernode, this will require staking 5,000,000 PSL (currently ~$3500).  

Supernodes:

• Process NFTs
• Secure the network (as nodes always do)
• Earn staking and block rewards

Just to reiterate, protocol and staking rewards for running a Supernode add up to 42% APR. Currently the same as the KuCoin offer.

Conclusion

The bear market offers an opportunity to get in nice and early on projects like this.

If you want to know more about how the network operates - see resource 6, which will link you to the explanation of Smart Tickets.

The proof-of-burn mechanism is likely to result in a supply squeeze on this token over time, with more tokens being burned as network adoption grows. Potential long-term price action- what do you think?

Terminology note for my inner pedant

The term - coin - refers to cryptocurrencies used to operate and secure a network - PSL is a coin - not a token - according to this definition. I have used the two terms interchangeably. Forgiveness - but coinenomics sounds pretty stupid.

Resources

1. Pastel webpage

2. Whitepaper - gitbook documents

3. Fees and burn - gitbook documents

4. KuCoin node staking promotion guide

5. Supernodes information - gitbook documents

6. Smart Tickets - gitbook documents

7. Real whitepapers - for the network and the Pastel coin