Everything You Wanted to Know About Staking
Red Pulse bot last edited by
With the PHX token swap well under way, we’re now ready to unveil staking. Staking is set to launch for everyone on August 20, at which point you’ll be able to deposit PHX into your platform wallets and earn staking rewards!
What is Staking and How Does It Work
In the world of crypto, staking refers to the reward you receive for supporting a network or token by holding the token or running a node. There are many ways in which staking can be implemented. With Red Pulse, we’ve decided to tie in staking with the platform itself. In order to stake your PHX, you’ll need to deposit your token into your www.redpulse.com account.
You’ll then be required to “fire up” your PHX into PHF (PHOENIX Fire). Once your PHX has been converted to PHF, you’ll then start to earn staking rewards.
How Do I Stake My PHX
1. First you’ll need an account at www.redpulse.com. Once created, please login and navigate to “My Wallet”.
2. Next step is to “fire up” your PHX and convert it to PHF.
3. Your PHX will now be converted to PHF, and your staking rewards will be calculated based on the amount of PHF you have. When you’re ready to convert back to PHX, you’ll click on “fire down”. The conversion rate for PHX to PHF is 1:1.
Please note that the fire down process takes 30 days to complete, and you will stop staking on the amount fired down as soon as the process starts.
How Much Can I Earn from Staking
As outlined in our whitepaper, we will be turning on inflation around the same time that staking is set to start. The total supply of PHX will increase at a rate of 10% per year once inflation is turned on. From these newly minted tokens, 50% will be reserved towards rewarding contributors, while the other 50% will be split between all users staking on our platform.
In order to calculate individual staking rewards, we have implemented a tiered staking system that is meant to encourage users to stake more PHF. The tier determines the rate at which you earn PHF, and are determined by the amount of PHF that you are staking.
- Silver (0–99,999 PHF staked)* Gold (100,000–999,999 PHF staked)* Platinum (1,000,000–9,999,999 PHF staked)* Diamond (10,000,000+ PHF staked)
The way the tiers work is that no matter what tier you’re on, you’ll earn PHF at a base staking rate of 5% per year. We’ll then subtract the total amount of staking rewards earned by all stakers on this baseline rate from the total amount of PHF that was reserved for staking.
The left over amount will go into an excess staking pool. This excess staking pool will then be divided among stakers according to the tier that they’re at, with Silver being weighted at 1, Gold weighted at 2, Platinum weighted at 4, and Diamond weighted at 8.
The chart below outlines an example scenario of what staking rewards would look like if there were:
- 5,000 Silver tier users staking an average of 8,000 PHF* 200 Gold tier users staking an average of 200,000 PHF* 20 Platinum tier users staking an average of 5,000,000 PHF* 10 Diamond tier users staking an average of 50,000,000 PHF.
In this example, a user staking:
- 8,000 PHF will receive a total of 460 PHF annually* 200,000 PHF will receive a total of 13,002 PHF annually* 5,000,000 PHF will receive a total of 400,082 PHF annually* 50,000,000 PHF will receive a total of 5,501,643 PHF annually
Please note, these figures will be changing constantly as users fire up and down their PHX. Staking rewards will be calculated and distributed on a daily basis.