Figment
Published in

Figment

NuCypher WorkLock: Staking Scenarios

The NuCypher network has launched. If you participated in the WorkLock, you may be trying to wrap your head around the staking options. We can help. Here are some simple strategies & ways to optimize.

Terminology

Wind down — this begins the unlock countdown–as your stake gets closer to being liquid, your maximum potential rewards decrease. Until “wind down” is turned on, the clock that you set for unlocking your stake will not begin.

Restaking — this causes new rewards to automatically be added to your locked up stake. Your rewards will compound, but they won’t be liquid until 1) you “wind down” your stake and 2) the unlock period of eg. 180 days passes.

Substake dividing — you can portion your stake so that parts of it have longer unlock periods, earning you more rewards and speeding up the release of your ETH.

Have other questions about NuCypher staking? Check out our FAQs.

Options and Strategies

Your ETH is unlocked at a rate proportional to your earnings. Your earnings depend upon two things, primarily: 1) the proportion of the token supply staked (less staked –> greater rewards) and 2) the length of your lockup.

Typically, WorkLock participants must stake their NU for at most 180 days in order to get their ETH deposit and NU tokens. There are a few ways to do this–let’s take a look.

Scenario 1(a): Stake 100% of NU for 180 days

Wind down: on
Restaking: off

What happens?

Day 1: You will be earning 50% of your maximum potential NU rewards and the rewards will be liquid.
Note: if you set restaking to on, your rewards will be locked into your stake.

Day 90: you will be earning 25% of your maximum potential NU rewards.

Day 180:

  • 100% of your NU tokens will be unlocked
  • you will be receiving 0% of your maximum potential NU rewards
  • 100% of your ETH will be unlocked

Note: in this scenario your reward rate will decrease every day that your staked NU approaches unlock. This is because “Wind down” is on.

Scenario 1(b): Stake 100% of NU for 180 days

Wind down: off
Restaking: off

What happens?

  • Day 1: You will begin by earning 50% of your maximum potential NU rewards and the rewards will be liquid.
    Note: if you set restaking to on, your rewards will be locked into your stake.

By day 90: you will be earning 50% of your maximum potential NU rewards.

By day 180:

  • 100% of your NU tokens will still be locked
  • you will be receiving 50% of your maximum potential NU rewards
  • 100% of your ETH will be unlocked

Note: in this scenario your reward rate will remain fixed because your staked NU are not set to begin unlocking. At any time you can switch “Wind down” on and your staked NU tokens will gradually unlock over the next 180 days.

Scenario 2: Stake 100% of NU for 360 days

Wind down: on
Restaking: off

What happens?

Day 1: You will be earning 100% of your maximum potential NU rewards and the rewards will be liquid.
Note: if you set restaking to on, your rewards will be locked into your stake.

Day 120: 100% of your ETH will be unlocked

Day 180: you will be earning 50% of your maximum potential NU rewards

Day 360: 100% of your NU tokens will be unlocked

  • you will be receiving 0% of your maximum potential rewards

Note: in this scenario your ETH will be unlocked two months faster because you set a 1-year unlock period for your NU stake. Since “wind down” is on, your NU stake will gradually unlock, so your reward rate will decrease every day that your staked NU approaches unlock.

Scenario 3: Divide and stake 50% of NU for 180 days and 50% of NU for 360 days

Wind down: on
Restaking: off

What happens?

Day 1: You will be earning 75% of your maximum potential NU rewards and the rewards will be liquid.
Note: if you set restaking to on, your rewards will be locked into your stake

Day 150: 100% of your ETH will be unlocked

Day 180:

  • 50% of your NU will be unlocked and not earning rewards
  • your remaining NU be earning 50% of your maximum potential NU rewards

Day 360: 100% of your NU tokens will be unlocked

  • you will be receiving 0% of your maximum potential rewards

Note: in this scenario your ETH will be unlocked one month faster because you set a 1-year unlock period for half of your NU stake. Since “wind down” is on, your NU stake will gradually unlock, so your reward rate will decrease every day that your staked NU approaches unlock.

Remember

The relationship between stakers and staking service providers is unique: you will need a dedicated node for each allocation. If you’re looking for a staking service provider, contact us.

If you would like to learn more about NuCypher, we have published additional resources here.

Subscribe to get email alerts about our latest resources.

Originally published at https://figment.io

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store