A detailed description of Nervos (CKB) supply and issuance

Matt Quinn
4 min readJul 28, 2020

One of the most common questions asked by newcomers to the Nervos project is “what is the total supply?”.

Native token issuance of Nervos (CKB) is fixed and not subject to change, however it is a little more complicated than most blockchains. Issuance has been designed to align the incentives of the different stakeholder groups in the network.

Components of CKB issuance

  1. Primary issuance

33.6 billion CKB, halving every 4 years (first halving expected ~Nov. 2023)
Example: first 4 years is (33.6b/2) / 4 = 4.2 billion CKB per year

2. Secondary issuance

Secondary issuance is constant, at 1.344 billion CKB per year indefinitely.

This amount is divided 3 ways:

  1. Compensation for miners (state rent on users storing data on-chain)
  2. Compensation for Nervos DAO depositors (users that have locked CKB in the DAO)
  3. Treasury funds (based on liquid CKB that are not being used to store data)

Today, secondary issuance is being directed toward miners and DAO depositors, while the CKB that would be depositing into the treasury fund is being burned, more information can be found here.

The treasury fund can be activated through a community-agreed hard fork, following depletion of the Nervos Foundation Ecosystem Fund.

CKB as a utility token

Though CKB can be used to pay transaction fees, its primary utility is a claim on storage space on-chain.

For example: if a user is storing a balance of USDT on Nervos, it would require storing 150 bytes of data on-chain. The user would need to utilize 150 CKB they own to do this. While storing data on-chain, these CKB are locked. Note that this is not a fee, the CKB being used still remain the property of the owner.

CKB as a store of value

By depositing CKB in the Nervos DAO, they can be held as a store of value (effectively fixed supply), even though total supply is uncapped.

The details of the Nervos DAO and how to use it can be found here. It is a protocol-level smart contract that provides native token issuance to depositors that offsets the inflationary effects of secondary issuance.

Base (or primary) issuance is fixed, so once a user has deposited their CKB in the Nervos DAO, they “lock in” ownership of a percentage of total CKB issuance for the time their CKB is deposited.

Overview of initial supply allocation (genesis block)

Initial supply (created in genesis block)
33.6 billion CKB (8.4 billion (25%) was burned.

1. Public Token Sale

  • 21.5% of initial token supply
  • Circulating upon Mainnet launch with no-lockup

2. Ecosystem Fund

  • 17% of initial token supply
  • 3% of amount circulating upon Mainnet launch
  • Will be unlocked over 3 years and reserved to build the Nervos ecosystem

3. Team

  • 15% of initial token supply
  • Vested over 4 years
  • 1/3 of amount circulating upon Mainnet launch

4. Private Sale (2018)

  • 14% of initial token supply
  • Unlocked over 2 years
  • 2/3 of private sale tokens circulating upon Mainnet

14% of the total tokens in genesis block were sold for approximately 28M USD to certain institutional investors in early 2018 with a token price approximately 1 CKB = 0.006 USD. You can find more details here.

5. Founding Partners

  • 5% of initial token supply
  • Unlocked over 3 years
  • Non-circulating upon Mainnet

The Founding Partners who helped start the Nervos network

6. Foundation Reserve

  • 2% of initial token supply
  • 100% unlocked on 2020–07–01
  • Non-circulating upon Mainnet

The Nervos Foundation reserves 2% of the Genesis tokens for “common good” use of the state storage capacity, such as providing built-in libraries.

7. Testnet Incentives

  • 0.5% of initial supply, circulating upon Mainnet

Rewards for testnet participants through the mining competitions and the bug bounty program.

8. Burn: 25%

  • 25% of the Genesis tokens was burned (non-circulating) in the Genesis block and will never enter the circulating supply.

Issuance chart

For more information, follow the Nervos project on the Nervos Talk forum or join the Nervos Discord server today!

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