In the previous post, we discussed how you can receive DXN by participating in DEXON’s Public Sale through COBINHOOD’s Coin Offering Platform. In this post we will go into detail about how you can acquire DXN by becoming a miner.
EDITOR’S NOTE:
This is the third post in a series of articles discussing the basic information about DXN, ways to acquire DXN, and other relevant information regarding DEXON’s native currency. This blog post is based from DEXON’s GitHub, where more details can be found.
TABLE OF CONTENTS:1. Introduction
2. How does mining work on DEXON?
• Proof-of-Participation Model
- Mining rewards
- Validator eligibility
- Symmetric Validator Power
• Adaptive Mining Mechanism
5. Mining rewards in circulation
6. Technical Specifications
• Hardware requirements
• Software requirements
Introduction
Nodes that actively participate in validating transactions will get DXN as mining rewards based on DEXON’s Proof of Participation Model (PoP) and 3 billion DXN or 75% of the total supply will be allocated as mining rewards.
How does mining work on DEXON?
Proof-of-Participation Model
- Mining Rewards: A validator earns transaction processing fees (or “gas fees”) and mining rewards when it actively produces blocks.
- Validator Eligibility: A node is eligible to join as a validator if its DXN deposit reaches the threshold of 1 million DXN. The deposit can come from the node itself or from any other accounts that support the node. It takes up to 3 hours for the deposit to become effective, and another 72 hours for deposit withdrawals to become effective.
- Symmetric Validator Power: DEXON adopts a state-of-art VRF based sortition function to randomly select block producers from eligible nodes.
Through the mechanism, the validating power and the probability to be selected as a block producer among all validators are both fair and symmetric, meaning that the expected mining rewards of each validator will be the same as well.
Adaptive Mining Mechanism
DEXON adopts a novel adaptive mining mechanism that can self-adjust the token minting velocity. The token minting velocity is proportional to the participation rate of mining. If the demand of DXN is strong, it will attract more coin holders to participate in mining for rewards, hence the minting velocity will increase, and vice versa. This will make sure the system can keep demand and supply balanced by itself. The formula of minting velocity is stated below:
Total supply growth rate (annual) = node mining velocity (annual) x mining participation rate (the percentage of deposited tokens in validators relative to current total token circulation) = node mining velocity (annual) x the deposited token in validators divided by the total token circulation.The following conditions between node mining velocity in relation to the minted coins is shown below (under half-life condition):
- Node mining velocity = 18.75% when mainnet launches.
- Node mining velocity = 9.375% after 1.5 billion DXN are minted.
- Node mining velocity = 4.6875% after another 750 million DXN are minted, and so on.
Mining rewards in circulation
Now, let’s consider the influence of mining participation rate. For example, the genesis supply of DXN is 1 billion, if 500 million coins are deposited in validating nodes, the mining participation rate will be 50%. So the total supply growth rate will be 18.75% * 50% = 9.375% (shown in the figure below).
We assume, that, if the participation rate does not change, then the total supply growth rate will still be fixed at 9.375% until another 1.5 billion DXN are minted as mining rewards, which will then reach the first half-life condition and the total supply growth rate will change to 9.375% * 50% = 4.689%.
Technical Specifications
Here are some basic instructions for a node operator to successfully run a DEXON BP node.
Hardware Requirements
- Minimum requirements:
• CPU: 4 Cores 2.0+ GHz
• Memory: 8 GB
• Bandwith: 100mbps
• Estimated cost: $200–$400 USD/month - Recommended requirements:
• CPU: 8 Cores 2.0+ GHz
• Memory: 16 GB
• Bandwith: 200mbps
• Estimated cost: $600–$800 USD/month
Software requirements
- OS: Linux 64 bit.
- Docker image: dexonfoundation/dexon
- Docker
- Go compiler
- C++ compiler
- Library: gmp, openssl, pkg-config
Mac, Windows, and Linux development environments should work but we recommend Linux.
Follow the appropriate link below to find installation instructions for your platform.
For more details (including environment setup, software instructions, etc.), check out the DEXON BP Node Operation Guide on DEXON’s GitHub.
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