Liquidity and staking pools are commonplace – everyone is fully familiar with such. Destruction mining pool is anything but commonplace. Interestingly, it is one of the many firsts that HALO Network is bringing to the crypto space. Nevertheless, the question of the lips of many is: What are destruction mining pools?
Understanding The Concept Of Destruction Mining Pool
In a regular mining pool, several entities contribute their assets to increase the likelihood of finding a block and sharing the corresponding block reward.
In a destruction mining pool, the initial asset is sacrificed to attain the block reward. It is different from the conventional liquidity pools where you can easily recover the staked asset. You don’t get back that initial stake once you opt for a destruction mining pool.
Why Use A Destruction Mining Pool?
The choice of a destruction mining pool is not popular. Usually, no one is enthusiastic about burning their assets in the pursuit of block rewards. Yet, this type of mining pool is often aimed at either tackling inflation or as a means of conducting an asset swap while incentivizing participants in the process.
Often, destruction mining pool is more lucrative compared to other types. The burning of the asset makes it appealing to many projects.
What Is HOS Destruction Mining Pool?
This is liquidity pool with destruction attributes aimed at burning the HOS-IDO tokens while rewarding participants with HOS. HALO Network issued HOS-IDO tokens during the presale phase, but these cryptocurrencies are merely receipts of purchase. To distribute HOS tokens to all those that participated in the HOS IDO, HOSWAP used the HOS destruction mining pool.
Four destruction mining pools have been created to kick-start the transitioning of HOS-IDO tokens to HOS. These pools – which exist on both Binance Smart Chain’s PancakeSwap, Uniswap, and HOSWAP can only give out 21900 HOS tokens, an indication of the underlying purpose of the destruction mining pools.
Using the HOS destruction mining pools shouldn’t be difficult. There is a guide to making things look easy. Here is a link to that guide.
Conditions Guiding The Use Of The HOS Destruction Mining Pools
Due to the deep-rooted purpose behind the HOS destruction mining pools, several conditions guide the use of these pools. Here are some of the notable conditions:
- 180-Day Burn Duration
Once you begin the ‘burning’ of your HOS-IDO tokens, the process will take 180 days to complete. The long conversion process is incentivized by the staking rewards offered. All four HOS-IDO destruction farms have an output of 30 HOS daily. Depending on your contribution to the pool, your reward might prove substantial.
- HO Is Needed
To put your HOS-IDO tokens to work in the destruction mining pool requires gas, you must pay transaction fees. Unsurprisingly, your HOS-IDO holding won't help; you need to get some HO tokens. You have to complete several confirmations on the journey to burn those HOS-IDO tokens, so gas is required. Fortunately, you can swap USDT for HO on HOSWAP without problems. Remember that HOS-IDO has no value besides being used to farm HOS tokens in the destruction mining pools.
- APY Changes
The rewards obtainable from burning your HOS-IDO tokens through the destruction mining pools vary. With more participants, staking rewards drop. Despite the drop, the risk to reward ratio is reasonably low. You are certain to get your initial stake back plus more.
Why Is A HOS Destruction Mining Pool Important?
The use of HOS destruction mining pools is not popular. So why did HALO Network settle for this mining pool type for its genesis pool? Let’s get straight to it:
- HOS-IDO Token Replacement
The initial DEX offering (IDO) for HOSWAP’s native token, HOS took place though not as many anticipated. Participants received HOS-IDO tokens. But these cryptocurrencies were only to be used as receipts in the collection of HOS tokens.
You stake HOS-IDO tokens in the genesis pool. In these destruction pools, the miners get HOS tokens gradually based on their HOS-IDO tokens.
- Prevents Unhealthy Inflation
HALO Network always planned to utilize the destruction mining pools as it helps them achieve one thing: efficiently manage inflation. By having HOS tokens released in trickles over a long time, the market does not get flooded with the HOSWAP native token. It’s such an effective approach towards keeping the supply of HOS in check.
Conclusion
HOS destruction mining pools achieved several things for HALO Network and HOSWAP. The genesis pool brought stability to the management of HOSWAP’s native token. Due to the unique HOS IDO model which required the issuance of HOS-IDO tokens, the destruction mining pool is suddenly crucial. Thankfully, everything went exactly as planned as the HOS destruction mining pool delivered the goods.
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