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Copy file name to clipboardExpand all lines: docs/stake-and-delegate/dual-staking-working.md
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@@ -18,7 +18,7 @@ Core operates on the **Satoshi Plus consensus**, integrating three delegation so
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By meeting specific **CORE-to-BTC staking ratios**, users gain **boosted Bitcoin staking rewards**, paid in CORE. While Dual Staking enhances BTC staking yields, it does not affect CORE staking rewards directly.
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Dual Staking does not affect these reward pools, but does enable Bitcoin stakers who also stake CORE tokens to earn a higher proportion of rewards in the Bitcoin Staking pool. In this section, we cover in detail the working of the grading algorithm with respect to dual staking.
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1.**Boosted Yield Levels**
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#### 1. **Boosted Yield Levels**
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Under Dual Staking, there are 3 boosted yield tiers for Bitcoin Staking based on the proportion of CORE staked relative to Bitcoin staked. For Solo-Stakers of only Bitcoin, a fourth tier exists with the lowest Bitcoin staking rate. It is important to note that the annual reward rate for Bitcoin Staking can fluctuate significantly, often due to varying prices and other market dynamics. As a result, the actual boosted yields may change daily based on market conditions.
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* **P<sub>BASE</sub>** \= the BTC staking base rate
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* **P<sub>Level1</sub>** \= the BTC staking base rate \+ Level 1 boosted yield
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* **P<sub>Level2</sub>** \= the BTC staking base rate \+ Level 2 boosted yield
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* **P<sub>Level3</sub> (P<sub>MAX</sub>)** \= the BTC staking base rate \+ Level 3 boosted yield
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***P<sub>BASE</sub>**\= the BTC staking base rate
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***P<sub>Level1</sub>**\= the BTC staking base rate \+ Level 1 boosted yield
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***P<sub>Level2</sub>**\= the BTC staking base rate \+ Level 2 boosted yield
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***P<sub>Level3</sub> (P<sub>MAX</sub>)**\= the BTC staking base rate \+ Level 3 boosted yield
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Effectively, the CORE emissions are distributed pro rata based on the BTC TVL, weighted based on their dual staking tier (CORE:BTC).
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2.**Staked CORE Thresholds and Staking Ratios (R<sub>1</sub>, R<sub>2</sub>, R<sub>3</sub>)**
The deciding mechanism for a Bitcoin staker’s yield tier (**P<sub>BASE</sub>**, **P<sub>Level1</sub>**, **P<sub>Level2</sub>**, or **P<sub>Level3</sub> (P<sub>MAX</sub>)**) is based on CORE tokens staked relative to Bitcoin staked, where **R** represents the `CORE:BTC` Ration and **R<sub>3</sub> \> R<sub>2</sub> \> R<sub>1</sub>**. The current CORE:BTC staking ratios are as follows:
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* Staking Ratio R1 \= 2,000 CORE per 1 BTC
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* Staking Ratio R2 \= 6,000 CORE per 1 BTC
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* Staking Ratio R3 \= 16,000 CORE per 1 BTC
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* Staking Ratio R1 \=3,000 CORE per 1 BTC
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* Staking Ratio R2 \=9,000 CORE per 1 BTC
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* Staking Ratio R3 \=24,000 CORE per 1 BTC
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Keeping these ratios in mind, users can calculate the required threshold for each tier as follows:
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* **Staked CORE Threshold for P<sub>Level1</sub>** \= BTC staked quantity \* Staking Ratio (**R<sub>1</sub>**)
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* **Staked CORE Threshold for P<sub>Level2</sub>** \= BTC staked quantity \* Staking Ratio (**R<sub>2</sub>**)
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* **Staked CORE Threshold for P<sub>Level3</sub> (P<sub>MAX</sub>)** \= BTC staked quantity \* Staking Ratio (**R<sub>3</sub>**)
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***Staked CORE Threshold for P<sub>Level1</sub>**\= BTC staked quantity \* Staking Ratio (**R<sub>1</sub>**)
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***Staked CORE Threshold for P<sub>Level2</sub>**\= BTC staked quantity \* Staking Ratio (**R<sub>2</sub>**)
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***Staked CORE Threshold for P<sub>Level3</sub> (P<sub>MAX</sub>)**\= BTC staked quantity \* Staking Ratio (**R<sub>3</sub>**)
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:::note
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The staked CORE and/or staked Bitcoin can be distributed across multiple active Core validators.
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:::
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3.**Boosted yield level determination for each (1) staked Bitcoin**
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#### 3. **Boosted yield level determination for each (1) staked Bitcoin**
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* If staked CORE amount \<**R<sub>1</sub>**, the user is in tier **P<sub>BASE</sub>**
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* If **R<sub>1</sub>**\=\< staked CORE amount \<**R<sub>2</sub>**, the user enters tier **P<sub>Level1</sub>**
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* If **R<sub>2</sub>**\=\< staked CORE amount \<**R<sub>3</sub>**, the user enters tier **P<sub>Level2</sub>**
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The following is a simple example explaining how to calculate the required CORE to stake, based on the above mentioned parameters, to unlock boosted yield tiers for Dual Staking.
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Now, the user will have to stake CORE as per the following Staked CORE Thresholds to enjoy a higher yield on their staked BTC with the above variables:
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* Staking Ratio **R<sub>1</sub>**\=2,000
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* Staking Ratio **R<sub>2</sub>**\=6,000
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* Staking Ratio **R<sub>3</sub>**\=16,000
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* Staked BTC quantity \= 10 BTC
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* Staking Ratio **R<sub>1</sub>**\=3,000
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* Staking Ratio **R<sub>2</sub>**\=9,000
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* Staking Ratio **R<sub>3</sub>**\=24,000
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* Staked BTC quantity \= 10 BTC
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The **Staked CORE Thresholds** with the above variables are:
Hence, the staked BTC in this example will enjoy a yield of
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***P<sub>BASE</sub>** if the amount of staked CORE is below 20,000
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***P<sub>Level1</sub>** if the amount of staked CORE is above or equal to 20,000 but below 60,000
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***P<sub>Level2</sub>** if the amount of staked CORE is above or equal to 60,000 but below 160,000
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***P<sub>Level3</sub> (P<sub>MAX</sub>)** if the amount of staked CORE is above or equal to 160,000
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***P<sub>BASE</sub>** if the amount of staked CORE is below 30,000
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***P<sub>Level1</sub>** if the amount of staked CORE is above or equal to 30,000 but below 90,000
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***P<sub>Level2</sub>** if the amount of staked CORE is above or equal to 90,000 but below 240,000
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***P<sub>Level3</sub> (P<sub>MAX</sub>)** if the amount of staked CORE is above or equal to 240,000
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:::note
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The multiplier on each boosted yield tier is dynamic and subject to change as per the supply and demand conditions of the market
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* When staking a relatively large quantity of assets that can meaningfully alter the staking distribution, stakers are recommended to diversify the BTC or CORE staking across multiple validators to prevent over-concentration and maintain high rewards.
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* For instance, diversifying your stake across 6 to 10 validators with the highest rewards can help reduce the impact of high hybrid scores and maintain optimal yields.
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* Minimize the need to transfer and/or redelegate BTC staking to another validator to avoid loss of reward during the process.
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