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aelf Economic Model Episode II — Developers

aelf extends an invitation with enticing stimulates to encourage developers to deploy their DApps on aelf sidechains.

aelf has successfully launched its official mainnet token swap on September 9th. In line with its roadmap, aelf will hold a series of marketing events in the following months within this year, the events include but are not limited to aelf hackathon, node elections, sidechain auctions, and many more. In this article, we will go through the sidechain incentive model where developers could be best motivated to deploy their DApps on aelf.

Sidechain Incentive Mechanism with Customized Payment Models

When a DApp needs independent computing resources to ensure operating efficiency, developers can apply to aelf to create an independent sidechain for it. And in order to avoid unnecessary waste of resources, developers can request to increase or decrease the capacity of the sidechain. These settings meet the needs of resource segregation of different business scenarios on aelf.

Tokens in aelf are divided into four categories: mainnet ELF tokens, resource tokens, tokens created by developers, and voting vouchers. Resource token is used for the consumption of resources as long as the operations of sidechains or DApps are ongoing. ELF tokens here could be used to purchase resource tokens. Developers have many options to form their own payment models for their own convenience to manage their side chains and DApps. Or they can offer their tokens and build their own incentive models.

Exclusive Sidechain Charging Model

The pay-per-time model pays the exclusive resource usage fee (CPU resource / RAM resource / DISK resource / NET resource) according to the actual block production time. This is like a developer who needs to deploy an application to a cloud server. Pay according to the configuration of the cloud server (CPU / RAM / DISK and fixed bandwidth).
The cross-chain index fee model ensures the cross-chain transfer/verification capabilities, a certain amount of ELF needs to be mortgaged to pay the index fee when creating a side-chain. The index fee is charged according to the number of blocks, and the unit price is determined through consultation between the parliamentary organization and the developer. The main-chain production node performs a side-chain node indexing, allowing the side-chain to have cross-chain transfer and verification capabilities, extending the functions of the side-chain and maintaining the security of the side-chain network. The main-chain production node obtains the index fee for this.

Sidechain Support Plan Charging Model

So far, aelf sets up 4 exclusive sidechains and 1 shared sidechain. When an existing sidechain could no longer meet the need of a certain developer, s/he can use the current sidechain as the main chain to create and index the next level of sidechains. Developers who apply for the “support plan” need to submit a project plan and a share plan, which will be reviewed by the production node. After passing the review, they can utilize the “Side-chain Support Plan” for three months. After the three-month period, production nodes will vote to decide whether to continue the support plan or not.

The Sidechain Support Plan Charging Model is set following the two models below:
Developers Sharing Model: developers promise to share a certain percentage of revenue with production nodes. At the same time, this part of the revenue will flow into sidechain mining&staking pool, where holders of SHARE tokens could stake their SHARE tokens to receive the rewards from the sidechain. The distribution is carried out according to the weight of the amount of the user’s mortgage;
Cross-chain index fee model (same as the exclusive side-chain fee model)

Sharing Sidechain Charging Model

On the sharing sidechain, developers can deploy smart contracts reviewed by the council. Specifically, the Sharing Sidechain Charging Model is set following the two models below:
Developer-pay-transaction-fee model: Developers have to pay for the resources they consume. This will enable developers to optimize the program as much as possible to reduce the consumption of resources. Transaction execution for this contract fails when the resource Token is exhausted. The developer needs to hold sufficient resource tokens to keep the contract running. Developer transaction costs will go into the shared side-chain consensus contract to be evenly distributed to the production nodes.
Developer revenue sharing model: Developers distribute part of the revenue to the sidechain pool under the contract implementation. Users who locked tokens to the pool contract can claim rewards from this. The creator of the shared sidechain has to pay a cross-chain index fee to ensure cross-chain transfer and verification functions.

In sum, when a developer applies to create a side chain, he can 1. analyze the demand for resources on the chain of the DApp he wants to do, 2. choose the sidechain payment model that suits him, and 3. purchase the corresponding resource currency.

For example, when developers have a large number of contracts that need to be deployed and maintained, they can choose to open an exclusive side chain and use a form similar to rent payment to maintain the daily expenses of the entire chain of smart contracts; for development that chooses a shared side chain or, when the smart contract he needs to maintain has more data that needs to be stored on the chain, he can purchase more WRITE Token and STORAGE Token, and if the number of writes is more, he can buy more WRITE Token for Consumption.

In this perspective, aelf is very different from Ethereum. You need to pay gas fees for operations on Ethereum, and aelf does not charge gas fees. Instead, you need to hold ELF to obtain network resources such as CPU, RAM, and NET. When popular DApps appear, the Ethereum network becomes very congested, gas fees will be very expensive and the price fluctuates greatly, and there will even be cases where transactions cannot be completed due to congestion. On aelf, the cross-chain mechanism and diversified fee model can realize the reasonable allocation of resources on the chain while effectively reducing the developer’s use cost.

aelf has a sustainable economic and governance model to support a strong on-chain ecology, meeting the anticipations and attention of the public. Next, aelf will hold a hackathon and sidechain auction. We sincerely invite outstanding developers from all over the world to join the aelf ecological construction. Further events will be subject to our official announcements. If you have any questions, please join the aelf community and call admins for help.

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