With the upcoming release of the Dextoken whitepaper on the 5th of September, we want to give you more insight into our staking-rewards and dynamic supply system.
Staking Rewards — DEXG’s staking model
Staking rewards are a popular system to increase the liquidity of an asset and distribute tokens. Dextoken will use a sophisticated staking reward and supply model to create a balance of increased liquidity and price assurance. This model is based on a price volatility function to evaluate the number of tokens minted for the staking rewards over several staking rounds.
There will be eight rounds of staking rewards distribution. The number of tokens minted in each round is determined by the all-time-high price and the number of active addresses. This is achieved by utilising our speculative AMM system.
Simplified the higher the ATH and the more active addresses at the time of the snapshot, the fewer tokens will be minted for reward distribution. This counters an overly inflationary system and creates an attractive environment for price appreciation. The whitepaper will go into more detail on the exact mechanisms behind it and the timeline of the staking rounds.
Uniswap will determine the latest ATH price; the price of CEX will not affect it. We trust the price from Uniswap’s liquidity added by Initial Liquidity Offering (ILO).
The maximum supply of 200,000 DEXG is a theoretical value. With the successful launch of the initial liquidity distribution, we already created an adequate market price with a sufficient userbase. Looking at the current metrics, we can already say that the real maximum supply won’t reach the theoretical supply hard-cap of 200,000 DEXG.
Example: Assuming an ATH price of $250 for the first staking round and anticipating a very powerful community creating a steady rise of active user addresses and price, the maximum supply would end up at only 70,000.
Example supply models. (Source: DEXToken Whitepaper)
First staking reward round estimation
Looking at the current metrics of DEXG, we get an ATH price of $250 and around 600 active addresses. This would lead to 6,000 tokens minted as staking rewards for the first round. As the ATH and active addresses continue to rise steadily over time, the staking rewards for each of the following rounds decrease. The table below shows an exemplary demonstration for this.
Example demonstration of reward and supply evolvement. (Source: DEXToken Whitepaper)
As visible in the demonstration above, the maximum supply will cap out at 70,000 DEXG. With a total staking reward amount of 36,000 DEXG distributed, alongside 7,000 DEXG to the team fund and 7,000 DEXG for fundraising fund (10% of the final maximum supply each).
DEXG distribution in the exemplary demonstration. (Source: DEXToken Whitepaper)
To understand the Tokenomics it’s crucial to understand the difference between ‘theoretical max. supply’, ‘real max. supply’ and ‘circulating supply’.
Theoretical max. supply:
The DEXG supply is hard-capped at 200,000 — so no matter what happens, there won’t be more than 200,000 DEXG.
Real max. supply:
The real maximum supply is determined after the 8th round of staking. In our demonstration above, the real maximum supply ended up at 70,000. The 130,000 missing to the theoretical max supply will be burned.
The circulating supply will change with every round of staking, as new tokens are introduced into the DEXG ecosystem. After the 8th and final round of staking, the maximum and circulating supply will match up.
With all staking rounds finished the token distribution will be 80% in the hands of the open market, 10% team funding, 10% fundraising funds.
DEXG tokenomic distribution.
The 200,000 DEXG supply scenario
Reaching the 200,000 DEXG supply cap could only happen in the case of the initial liquidity launch failing to create a robust community, creating a low ATH and low userbase in the process. The below table shows a demonstration model for this scenario.
Theoretical maximum supply demonstration table. (Source: DEXToken Whitepaper)
Links & Ressources:
- Official DEXToken Website
- Official DEXToken Telegram Group
- Official DEXToken Announcement Channel
- Official DEXToken Twitter
- Official DEXToken Medium
- DEXG at Coingecko
- DEXG at Coinmarketcap
- DEXG at Etherscan
- Official DEXG Balancer Pool
- Trade DEXG on Balancer
- DEXG/USDT Uniswap Trading Pair
- DEXG Proof of Liquidity
DEXG tokens are not intended to constitute securities in any jurisdiction. The white paper does not constitute a prospectus or offer document of any sort and is not intended to constitute an offer of securities or a solicitation for investments in securities in any jurisdiction.
The Flowchain Foundation Limited disclaims any and all responsibility and liability to any person for any loss or damage whatsoever arising directly or indirectly from (1) reliance on any information contained in this white paper, (2) any error, omission or inaccuracy in any such information, or (3) any action resulting therefrom.
The value of DEXG tokens is currently very volatile. Flowchain Foundation (“Company”) does not have any means of stabilizing the token value, please buy at your own risk. Unlike bank accounts or accounts at some other financial institutions, DEXG are uninsured unless you specifically obtain private insurance to insure them. Thus, in the event of loss or loss of utility value, there is no public insurer or private insurance arranged by Company, to offer recourse to you. Because DEXG are based on the Ethereum protocol, any malfunction, breakdown or abandonment of the Ethereum protocol may have a material adverse effect on the platform or DEXG. Moreover, advances in cryptography, or technical advances such as the development of quantum computing, could present risks to the DEXG and the platform, including the utility of the DEXG for obtaining services, by rendering ineffective the cryptographic consensus mechanism that underpins the Ethereum protocol.