In this article, we present a proposal to shift from the buyback model to a staking model, enabling users to stake cNETA/NETA tokens for the purpose of earning cBTC revenue and assets from the NETA Liquidity Fund.
Introduction
We extend a warm welcome to our 4th governance vote.
In the preceding week, we successfully concluded our 3rd governance vote, during which our community elected to eliminate the BTC Fund and execute the burning of 30% of the total supply. This strategic measure resulted in the incineration of 600 million tokens, reducing the total supply from 2 billion to 1.4 billion, with a remaining number of 700 million cNETA and 700 million NETA tokens.
Staking Proposal
Today, within the framework of our governance vote, we propose a shift from a buyback model to a stake-and-earn model.
This proposal is rooted in the belief that buybacks, as a sole means of capitalization, are suboptimal, necessitating token liquidation for value realization. Conversely, the staking model empowers users to passively accrue benefits from the project, thereby promoting long-term token retention.
Furthermore, our proposal introduces the strategic distribution of the NETA Liquidity Fund, affording users the opportunity to claim assets from the fund. The primary aim is to provide an immediate and consistent source of earnings for cNETA/NETA holders, sustained over a one-year period. This duration allows our protocol to generate substantial cBTC revenue for the continued provisioning of long-term rewards.
Voting Options
- Option 1: Distribute 2 cBTC and 36,000 ERG (value of ~350,000 ADA) to cNETA/NETA stakers over 1 year;
- Option 2: Do not distribute 2 cBTC and 36,000 ERG from the community fund to cNETA/NETA stakers.
Stake to Earn
There are 2 revenue streams of staking:
- Revenue generated from protocol in cBTC;
- Revenue accrued from the NETA Liquidity Fund.
Revenues generated in cBTC will be disbursed to cNETA staking contracts, and stakers will receive their cBTC earnings on a monthly basis.
At present, we propose the community fund’s 2 cBTC be available for distribution while keeping the other 140,000 ADA + 12 million cNETA in the cNETA/ADA pool on Minswap. The current value of the 2 BTC is equivalent to 230,000 ADA. Additionally, there are 36,000 ERGs to be distributed, equivalent to 120,000 ADA.
Of course, the rewards will be shared proportionally with cNETA and NETA holders.
Staking in the cNETA staking contract will facilitate the periodic accumulation of a portion of these rewards each month.
To be eligible for cNETA rewards, participants must have been staking during the entire preceding month. The same principle applies to the NETA side, with rewards earned in NETA.
In total, approximately 30,000 ADA value in rewards can be acquired each month by staking cNETA/NETA. These rewards are accessible on both Cardano and Ergo blockchains.
The exact staking mechanism will be determined subsequent to approval, with the anticipated eligibility for earning cNETA and NETA commencing in Q4 2023.
Governance Details
The voting snapshot will be taken during epoch 447 (between November 6–11th) and begin during epoch 448. Once the vote is live, the vote will last 3 days (72 hours).
The same voting structure as vote 3 will occur, where eVOTE4 tokens will be airdropped to NETA holders and cVOTE4 tokens will be claimable via TosiDrop.
Final Remarks
We extend our sincere gratitude to our community for your unwavering support. We eagerly anticipate the forthcoming governance vote as we endeavor to establish ourselves as the leading Bitcoin wrapping protocol.
Subsequent to this, we will unveil Roadmap V4, spotlighting our v2 development, in our pursuit to create the most decentralized Bitcoin wrapping protocol in existence.
