The utility of Jarvis Reward Token

The Jarvis Reward Token (JRT) is a utility token for securing and governing the Jarvis network, and rewarding agents who would bring value to it.

This article explains the utility of the JRT. Informations about the token distribution is at the end of the article.

TLDR

• Validators and Relayers are securing the network and have to stake an increasing amount of the JRT as the value locked in the network grows.
• A DAO governs the protocols and collects the fees they generate.
• The final token supply will be 565M JRT but unsold tokens will be burnt.

What is the Jarvis network?

The Jarvis network is a set of protocols on Ethereum, allowing its users (traders) to be exposed to the price movement of any financial asset, against liquidity pools supplied by other users (liquidity providers, LP). From an ideological point of view, it tends to uberize brokerage by allowing everyone to bridge the gap between a market and an investor and tends to universalize access to markets.

More precisely, we are developing two protocols (more will come):

• The Margin protocol is a trust-minimized off-chain trading protocol, which allows great scalability without trusting in a third party.
• The Synthetic protocol (Synthereum) is an on-chain trading protocol based on UMA, which allows great composability with other protocols.

Staking JRT to secure protocols

The Margin protocol validators

Validators eliminate the need to trust each other's counterparty; they record trading data such as price and transaction history, hash them and link these hashes in some kind of sidechain on IPFS.

The relayers on Synthereum

Relayers protect the liquidity of LPs; they run an off-chain order book and matching engine to ensure that deposits and withdrawal of collateral to mint or burn synthetic assets takes place without abusing the liquidity pools.

Staking JRT

In both cases, validators and relayers must stake a certain quantity or a certain value of JRT so that the cost of corruption is greater than the profit from corruption. They act with benevolence and have to reach an absolute consensus; if they misbehave or do not reach a consensus, a dispute is raised and will be resolved by the DAO.

Staking rewards

To compensate for their work, they will share part of the fees generated by the protocols; the responsibility to determine the number of validators or relayers required as well as their remuneration belongs to the DAO, but we will suggest starting with 5 validators and 5 relayers and to share 5% of the fees collected between them.

Delegated and pooled staking will come to the party as well.

Some numbers…

Today there are 5 active traders trading daily through the Margin protocol, generating an average volume of $ 1M per day.

It is a small sample, but let’s extrapolate while carefully reducing to $ 100k of volume per day per user (it goes quickly with leverage).

• 5,000 users would generate $500M/day and $5k in fee for DAO;
• Each validator would then receive $50/day (5% of $5k, divided by 5 validators), and between $12k (250 working days) to $18k (365 days in the case of crypto trading) per year;
• The yield per user would range from $2.4 to $3.6/year for a daily volume of $100k/user;
• The yield for a staker will thus depend on the price of JRT and the amount of JRT required.

⛔ These figures are given by example to see the relationship between volume and staking reward; there are dozens of variable impossible to take into account which makes these figures highly inaccurate; in no way, you should use these exact figures to form an opinion or whether or not you would like to stake, buy, sell, do not buy, or hold JRT.

Role of JRT in governing protocols

The main role of the JRT remains the governance of the protocols through a DAO, which owns and controls them.

Each JRT holder, tokenized pool holder (Uniswap, Bancor, Relayers, Validators, Liquidity providers, etc.) can join and participate in the DAO, which will have several roles (not all the roles will be implemented from day 1, it will be incremental):

• discuss, debate, propose improvements or changes in some settings, accept an update of the protocol, or pause it (circuit-breaker);
• collect the commissions generated by the protocols and vote for their allocation policy for the best of the ecosystem (for example which percentage should be paid to Relayers and Validators, to Uniswap and Bancor LP, to the insurance funds, to trading contest price pool, to active DAO members, etc.);
• manage the JRT reward policy via the Reward Funds (how much to reward Uniswap liquidity providers, Aave lenders, etc.);
• resolve disputes when Validators or Relayers do not reach a consensus.

To avoid Sybil attack and the concentration of votes in the hands of few, the number of JRT will be just one of the components of the voting system, and the voting power would not be proportional to the amount of JRT owned. It will also take into account the time (for how long the JRTs have been HEDL, in the DAO, on Uniswap etc.), and engagement (Uniswap token, LP in one of the protocols, staking, number of votes in the DAO, number of propositions that have been accepted, merit points given by other token holders, etc.).

Distribution and quantity of JRT

⚠ Important note: there are currently 225M JRTs, but that number will increase to 565M in a few months, but the newly minted tokens will be locked for 9 months.

This 150% increase corresponds to the private and public sales we organized one and two years ago among our “forever-holder core-community”. Our first supporters are proud long term holders and fear no crypto-winter (actually most of them are not into cryptos and have “invested in the team” more than in the project).

This increase in the total supply is an illusion: it replaces the first system with two tokens (a classic token and a special-token-sale token), which divided the total number and value of tokens between them. It created a lot of confusion, and complication, and made impossible to estimate the value of one JRT. After long discussions with the community, we found that merging the two tokens into one was more beneficial.

The distribution is as follows:

Regarding the 405M tokens for sale during the various sales, the following table provides some insight:

• 263.8M JRT were sold during a first private sale in 2017; 26.8M are available, and 237M will be issued and locked for 9 months;
• 28.1M JRT were sold at a public sale in 2018; 3.4M are available, and 18.7M will be issued and locked for 9 months;
• 26.9M JRTs have been sold, those include around 18M since the official launch of private sales last April out of which 6M are blocked for 90 days, and 12M will be issued and locked for 9 months;
• The targeted hard cap is 600k euros, 128k euros have already been collected. Reaching the hard cap at the current OTC selling price (average price over 7 days, or $ 0.0162), would correspond to selling 29M of tokens;
• 86M of tokens remain for sale, and if the hard cap of the 600k is hit, the unsold will be burned; if all the tokens will be sold at the daily price, 57M of JRT will be destroyed, but the more the price goes up, and the higher the average price too, the less it will be necessary to sell JRT to arrive at the hard cap, and the greater will be the number of tokens destroyed;

Out of the 600k targeted, at least 300k are dedicated to liquidity: some investors, as well as my own prop-trading firm (from where I brought some trader into the beta version of Jarvis market) have shown interest in providing up to 120K of cash without counterpart in tokens, reducing the remainder to be raised to 350k euros, or 21M tokens for sale at the current sale price, leading to the destruction of 64M tokens.

Conclusion

Staking is there to align the interests of the agents securing the protocols, and the DAO is necessary to decentralize Jarvis to the maximum.

Incidentally, the JRT could become a token in the future to unlock other features, such as reduced fees. We also have other ideas for protocols in which JRT could have a completely different purpose.

Pascal (pascal.jarvis.eth on Twitter).

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⛔ Risk Warning: Investing in digital financial assets involves a high degree of risk and volatility and is not suitable for all investors; do not risk more money than you can afford to lose. Please consult an independent professional financial or legal advisor to make sure the product is right for you.

⛔ Disclaimer: This article contains text, data, graphics, photographs, illustrations and information (“Information”) connected with Jarvis International and/or other entities part of the Jarvis group ( “Jarvis”). Jarvis attempts to ensure Information is accurate, however, Information is provided “AS IS” and on an “AS AVAILABLE” basis and may not be accurate or up to date. The publication of this article does not represent solicitation by Jarvis of buying the token “Jarvis Reward Token” and is not to be considered as a recommendation by Jarvis as to the suitability of any investment, if any, herein described. No action should be taken or omitted to be taken in reliance upon Information in this document. Jarvis accepts no liability for the results of any action taken based on the Information.