Staking is a benefit that is seen across a few cryptocurrency tokens and is used to incentivize holders in the world of DeFi yield farming, as well as in Proof-of-Stake blockchains.
In a similar process to yield farming, EQO tokens held or ‘staked’ on the EQUOS platform receive part of the daily Reward Batch that is allocated to staking rewards.
The ‘yield’ is based on a client’s holding relative to the already issued tokens. So, for example, if the Reward Batch on a particular day was 117,124 tokens, and the allocation to staking for the day was 15,811, and a client held 1% of the outstanding EQO tokens, that client would receive 158.11 EQO that day for holding the token.
Every day, the staking portion of the Reward Batch is allocated based on the overall ownership of EQO on the platform. If a client doesn’t sell the EQO which they have accrued and hold it in his or her wallet on EQUOS, he or she will receive more EQO daily for the remaining Reward Blocks. For example, if during any day within Epoch 1 there is a total of 2,000,000 EQO held on the platform, and a user holds 20,000 EQO, they will be eligible for 1% of all tokens awarded to staking. The Daily Reward Block during this period is 117,124 EQO. After taking up the Treasury Allocation, the Reward Batch is 105,411EQO. 15% of the Reward Batch is allocated to staking rewards, which is 105,411 x 15% = 15,811.76 EQO. Therefore, this client who is eligible for 1% of all tokens allocated to staking will be eligible for 1% of this allocation, which is 15,811.76 x 1% = 158.11 EQO on that particular day.
Holding EQO on EQUOS will also entitle clients to discounts on their trading fees. These discounts will be implemented through an uplift to the client’s fee tiers based on how many EQO are held by the client. Clients who hold 10,000, 50,000, 100,000, and 500,000 EQO in their balances will be upgraded by 1, 2, 3, and 4 tiers, respectively. The maximum fee tier that retail clients may be upgraded to is Fee Tier 5. For example, if a client on Fee Tier 2 has a balance of 50,000 EQO, they will be upgraded by 2 fee tiers, meaning that they will be treated as if they are at Fee Tier 4. However, if the same user were to hold 500,000 EQO, they will be upgraded to the maximum Fee Tier of 5. More information about EQUOS fee tiers may be found at https://my.equos.io/exchange-fee-schedule.
Shortly after EQO’s initial release, EQUOS will introduce the functionality to earn yield on different asset balances within wallets on EQUOS, powered by Digivault. This will mean, for example, that holders of Bitcoin on EQUOS will be able to earn yield on their Bitcoin by placing it into a lock account for specified periods of time. This is where EQO’s utility will come into play. EQO will effectively increase the yields available to clients by a factor of at least 10%.
To learn more about benefits of staking EQO, read the whitepaper here.
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