Over the past few weeks we have received a number of questions relating to circulating supply and our token release schedule. As a new pre-testnet project, this is to be expected, where the main activity for the token is currently trading. However, that is only temporary, with the first major launch for the CUDOS network on target for Q1 2021.
To address your questions, we’d like to share some bitesize explanations for each of the areas associated with circulating supply.
Let’s break it down:
Token release schedule
CUDOS tokens are scheduled to be released over a period of 10 years, until 100% of the total 10bn CUDOS have fully vested and are in circulation. The release schedule slows down over this 10 year period with 25% release by January 2022, 50% by January 2023, 75% by January 2025, with 100% not reached until January 2031.
The tokens are released into several allocation buckets:
- Private sale participants and advisors receive a percentage of their allocation each day via a vesting smart contract. Strategic investors from previous rounds with allocations have their tokens locked for 6 months, with 18 months daily vesting thereafter. It’s important to note that whilst these tokens vest each day, these individuals may decide to only move their vested tokens once per week or once per month into either staking, a private wallet or onto an exchange. That can appear as a jump in tokens entering circulating supply.
- Team tokens are locked for 6 months and then begin to vest quarterly over 3 years. The release of these tokens is dependent on the team reaching important development milestones, ensuring that the full vision of CUDOS is achieved.
- Ecosystem & Community Development tokens are used to incentivize network and community growth. This pot includes prizes, airdrops, bounties, staking rewards & bonuses, developer programs, partnerships and grants.
- Reserve tokens are for everything else including administration, operations, marketing and R&D
For more information download our whitepaper from www.cudos.org (Section 4 for token economics).
Unsurprisingly, a lot of us are obsessively viewing the listing site graphs and rankings, with the alt season in full swing. CUDOS is a low marketcap project right now, due to its recent launch and low initial circulating supply. Marketcap is calculated as the number of tokens in circulating supply, multiplied by the token price. With tokens released each day, the marketcap has the potential to increase. This is necessary to climb the rankings, which will in turn attract more people and grow the CUDOS network.
Whilst the released tokens are classified as circulating supply, that does not necessarily mean they are liquid, with a large percentage locked in staking contracts, or set aside for rewards and bonuses.
Validators running a CUDOS Validator Node (CVN), will need to stake a minimum of 2m CUDOS each. Whilst we will have 100 CVN’s in total, we are initially targeting 30 for the testnet in Q2. That’s a minimum 60m circulating CUDOS locked in staking contracts. Non validators will also be able to delegate their tokens for staking to a CVN. Our target is for 75% of all circulating tokens to be staked. An ambitious target that will be achieved with attractive staking rewards and bonuses.
Pre-staking is already available via BitMax or KuCoin exchanges.
Staking Rewards & Bonuses
Each year for the full 10 years, an allocation has been set aside for paying staking rewards and bonuses. The 1st year staking reward pot is 306m CUDOS. This will be proportionately split across everyone staking on the network. As a staker, you will receive a 25%, 50% or 100% bonus on the staking rewards you have earned, based on the staking contract length you choose. Check out our previous blog for more details.
To summarise, 25% or 2.5bn CUDOS tokens will enter circulating supply within the first 12 months. This is an average of 6.85m CUDOS entering circulating supply each day.
The below table provides an estimated total of how many CUDOS in circulating supply, will in fact be locked or assigned to staking contracts and therefore not liquid. This is the best case scenario, based on us achieving our 75% staking target.
Locked Circulating Supply
Amount in CUDOS
1st year staking rewards: 306,000,000
1st year staking bonuses: ~150,000,000
1st year estimated total staked: ~1,875,000,000
Liquid circulating supply: ~169,000,000
Once the CUDOS main net goes live later this year, users will be paying for compute in CUDOS tokens and suppliers will be receiving CUDOS tokens for their computing power. It is therefore necessary to have liquid CUDOS tokens to enable services over the network.
After all, CUDOS is a utility token!
To keep up to date on that and all updates regarding the CUDOS token, and to find out more about all the exciting solutions we’re working on, please visit our website and follow us on our social media channels linked below.