FreeDAO
Published in

FreeDAO

AirClaim Staking & Holding Guide

Stake your Claim—and hold steady!

One of the most common questions we’re being asked is regarding Staking Requirements in the upcoming Freeos AirClaim.

REMINDER: The AirClaim is launching on Midnight, UTC 0:00 — February 14th, 2022! Go to https://app.freeos.io for a countdown until the launch.

This guide will cover Staking, what it is, how to do it, and when it is necessary (and when it might not be).

Additionally, we figured we would also cover the Holding Requirements, which many of the community might not be aware of — and others might need a refresher.

Along the way, we will also cover KYC (Know Your Customer) and how that affects things like Staking, and how it might loosen the Staking Requirements when the Proton Team launches it.

There’s a lot to dig into, so let’s begin.

TL;DR

We have a couple of interactive, visual tools on the main freeos website: https://freeos.io to make it easy to understand what the Staking Requirements, and the Holding Requirements might be for any new user joining.

Staking Requirements

Staking is simply the amount of xUSDC (a US dollar backed stablecoin) that is required to put up for collateral to allow participants to make their weekly claims. Without staking, most users won’t be able to claim. A participant may “unstake” to retrieve this amount back again.

To play around with the Staking requirements scroll down to this section of the website.

Play with the “Participants On Join” slider. Basically this is how many participants are in the system. After the launch, we will have a live counter on the website showing how many participants have joined.

We estimate, most participants won’t be a “Verified Account” — until Proton releases their upcoming worldwide KYC system.

NOTE: Once Proton’s KYC releases globally — allowing most people to get verified — we will update the Staking Requirements, covered later in this guide.

Users can purchase xUSDC via Proton Swap, Alcor Exchange. Or even bridge it over to Proton from Ethereum using Proton’s Bridge.

Holding Requirements.

The Holding Requirement is simply how many FREEOS (or Points) you need to have in your wallet in order to claim. To play around with the Holding Requirements, scroll down to this section of the website:

Holding Requirements are intended to help participants earn/save enough FREEOS to pay for Mint Fees in the future, 2nd phase of the project — the Governance Phase.

For late participants, they may need to buy FREEOS tokens in places like Alcor Exchange to make up the difference.

RECOMMENDED: Join in on week 1. Save (at least) half of your FREEOS (or Points) each weekly claim cycle, and don’t miss any claims! Do all of these things and you won’t ever even need to think about the Holding Requirements — ever.

Staking — Simply a type of Collateral to protect Freeos

Staking exists for two primary reasons in the Freeos AirClaim.

  1. It protects the system by helping restrict bots and duplicate accounts.
  2. It helps limit the initial circulating supply of FREEOS tokens. Essentially it helps reduce early inflation of the token supply.

How is Staking used in Freeos?

  • Staking, in Freeos, is simply a type of collateral that is temporarily locked while the user is participating in a weekly claim cycle.
  • Staking is set as an amount of xUSDC, the wrapped version of the USDC stablecoin on the Proton blockchain.
  • Staking increases — for new participants only — as more people join and participate in the Freeos AirClaim. This increase in cost is to provide a soft limit on the number of participants in the AirClaim to help put a limit on the amount of tokens minted during this phase.
  • Staking Costs are different for participants that got verified in Proton’s KYC (Know Your Customer) system, and those that didn’t. Why? Because we know KYC users are unique people. For non-verified participants, we don’t know if they are duplicate accounts — or not — so extra collateral needs to be provided.
  • The xUSDC that a participant stakes can be returned — but it will only be released in the next iteration. Why? To prevent duplicate accounts from sharing a single amount between accounts.
  • If a user unstakes, they will no longer be able to claim — unless they re-stake at the same staking price as a new participant would.

What Staking is NOT

  • Staking costs do NOT increase for participants who are already staking. The cost will not increase for an individual, unless this individual un-stakes, and re-stakes again.
  • Staking is NOT related to claiming rewards. A participant cannot earn more Points or FREEOS by staking more. Any highly technical users — DON’T attempt to try to stake more than what is required by the dApp by submitting your own custom blockchain transaction! You are likely to simply lose your valuable xUSDC for no extra gain at all!
  • Unstaking does NOT return the xUSDC collateral immediately. Any unstaked amount gets returned at the start of the next week’s iteration.
  • Staking does NOT belong to FreeDAO, the Freeos team or any group or individual. The staked amount can, and will, be returned to the individual who staked the amount.

Scenario #1: Global KYC not yet Released by Team Proton

Below is a table that shows how much the Staking Requirements would be, for non-verified users (most people) and verified users that had undergone the early version of Proton’s KYC in the old Proton wallet.

The table shows the thresholds for the number of claims made in the Freeos system. As the claims increase, the Staking Requirements increase also. This helps restrict the amount of FREEOS tokens in circulation during this early AirClaim phase of the project.

NOTE: These are the values that are very likely to be launching on February 14th, 2022.

IMPORTANT: Staking Requirements may change beyond the thresholds listed in these charts to absolutely ensure there are limits to how many FREEOS tokens are ultimately minted during the AirClaim.

Scenario #2: Global KYC is Released by Team Proton!

Below is a table that shows how much the Staking Requirements would be, for non-verified users (most people) and verified users in the new, upcoming global KYC system.

Like above, this table shows the thresholds for the number of claims made in the Freeos system. As the claims increase, the Staking Requirements increase also.

Even with global KYC, the system needs to restrict the amount of FREEOS tokens in circulation during this early AirClaim phase of the project.

As you can see, the cost of staking eases for participants who have undergone global KYC, while the cost of staking for non-verified users goes up. Why? Because KYC’d participants are much more likely to be unique people — important for any democratic system!

IMPORTANT: Staking Requirements may change beyond the thresholds listed in these charts to absolutely ensure there are limits to how many FREEOS tokens are ultimately minted during the AirClaim.

How to get xUSDC for Staking?

There are plenty of ways to get xUSDC and we won’t be able to cover all of the many pathways.

First of all, xUSDC is the version of USDC on the Proton Blockchain. This is one of the most popular cryptocurrencies in the world, as it is a stablecoin backed by US dollars, making it a good medium of exchange between various other cryptocurrencies. USDC is a native token to the popular (and pioneering!) Ethereum blockchain.

USDC can be bridged (moved) over to the Proton chain using the Proton Bridge linked here.

Fortunately Team Proton made a handy guide to do this. Check it out here.

There are many ways to purchase USDC to bridge over to the Proton Chain.

Just know that, because the original USDC (and most versions being offered for sale!) is on the Ethereum network, you are likely to pay gas fees to move this USDC over. Recently, these fees can cost a lot.

For a list of official exchanges that the USDC team officially recommends, see this list here.

RECOMMENDED: The fastest, and cheapest way to get xUSDC is to first get Proton’s native token, XPR and to “swap” it for XUSDC in Proton Swap.

If you don’t already have XPR tokens, the easiest way to purchase them is through one of the exchanges that sell XPR.

Once you have purchased XPR, you can “withdraw” it to your personal Proton account.

NOTE: Since XPR is faster to send than most other cryptocurrencies, it can be much faster than bridging USDC over to Proton to become xUSDC. And since there are no gas fees, it is usually much cheaper too!

XPR is natively listed on the following exchanges:

Proton UK detailed on how to transfer XPR from KuCoin to your WebAuth wallet in this handy guide.

NOTE: KuCoin is a very large exchange where you can buy cryptocurrencies with a credit card and then you should be able to trade them for XPR, and transfer to your WebAuth wallet’s account. To do this, the above guide by Proton UK would be helpful.

Once you have your XPR in your WebAuth wallet’s account, you can quickly and cheaply swap it for xUSDC using Proton Swap.

Holding Requirements to HODL our FREEOS!

For some participants, who either came in very late to the AirClaim, who have missed some weeks of claiming, or who have sold more than 50% of their total possible FREEOS, they may need to purchase some FREEOS tokens to simply hold in their wallet, in order to claim (POINTs will also count towards this total).

This FREEOS holding requirement is to ensure that most users receive enough FREEOS tokens by the end of the AirClaim to pay the Mint Fee in the Governance Phase.

It also creates some early, basic demand for the FREEOS tokens on the open market to start the Freeos economic engines humming.

If a participant comes in late, he/she may need a number of FREEOS tokens to simply be held, in order to claim. The easiest way for most to gain these tokens is to purchase from an exchange.

Consider the following table that outlines the POINTs gained and the Holding Requirements per iteration (week):

If a new participant comes in at iteration/week 10, the holding requirement will be 900 FREEOS tokens.

This participant may purchase some FREEOS tokens from the exchange (like Alcor Exchange)

If the market price of FREEOS is at the locking threshold of $0.0167, this may be around the equivalent of $15 USD.

NOTE: this locking threshold is an experimental aspect of this new economy and the actual market conditions may be vastly different. Take this as an example to understand the system only.

What might motivate a participant to pay $15 to enter the AirClaim late?

This theoretical participant might consider that the remaining 15 weeks would earn an additional 8,200 FREEOS tokens.

And this also is more than the 5,000 FREEOS recommended for the Mint Fee in the upcoming Governance Phase, where participants should be earning approximately 1,000 Points per week (depending mostly on how the participants vote the issuance).

And by having some participants come in late, and potentially interested to purchase the FREEOS to enter the AirClaim — even for just the final weeks — there is potential for some early demand for FREEOS tokens to exist. Depending on how many POINTs are locked, and how many FREEOS are converted and sold, will factor into the supply and demand equation that typically sets prices of tokens on the open market.

As recommended in the beginning of this article, it is recommended to join in as early as you can. Save (at least) half of your FREEOS (or Points) each weekly claim cycle, and don’t miss any claims! Do all of these steps, and the Holding Requirements are no worry at all!

Hopefully this covers most of your questions about Staking and Holding Requirements — and how KYC is expected to update the staking requirements.

Stay tuned to further announcements, and we’ll keep the community updated if global KYC is released by the Proton team.

In the meanwhile, please check our webpage for more info, or join us in our Telegram Community where you may ask more questions about how Freeos is intended to work.

--

--

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