NSBT staking launched

Published in

Neutrinoteam

5 min readDec 3, 2020

The Neutrino token (NSBT) can now be staked. In this article, we’ll discuss the staking reward distribution system and explain advantages for early stakers.

We are excited to announce the release of an important update of the Neutrino protocol. Now NSBT, the Neutrino protocol’s recapitalization and governance token, has acquired a new function, staking, which allows users to receive rewards in USDN and WAVES for storing NSBT tokens at the Neutrino smart contract address. This innovation will increase the stability of the collateral reserves on the smart contract by further stimulating NSBT issuance and holding.

How it works

Since last week, all USDN token issuance operations (WAVES to USDN swaps and vice versa) are subject to a protocol fee. Accumulated fees will be distributed among the NSBT token holders who have staked their tokens. Fees are collected in USDN for WAVES to USDN swaps and in WAVES for USDN to WAVES swaps. Rewards are paid out daily to NSBT stakers’ Waves wallets.

How to stake NSBT

First, you need to purchase NSBT tokens. NSBT can be obtained in two ways: by issuing through a smart contract or by purchasing on the open market. Issuance through a smart contract implies a swap of WAVES to NSBT, which can be done in this interface. A purchase from a contract is not subject to extra fees, except for a transaction fee of 0.005 WAVES, regardless of the volume. However, the issuance price will be strictly determined by the NSBT curve depending on the current BR (backing ratio). This price may differ from the ask price on exchanges. You can read more about NSBT pricing here. The second way is to buy NSBT on an exchange. NSBT is traded in various pairs on Waves.Exchange and Swop.fi. ERC-20 NSBTs can be purchased on Uniswap and will have to be subsequently sent to the Waves network.

NSBT staking is available through the Waves.Exchange interface. To stake NSBT, you need to send tokens to a smart contract. To do this, enter the amount and click on the ‘Stake NSBT’ button. You can withdraw tokens from the contract with the ‘Unstake NSBT’ button.

Staking rewards distribution

The profitability of NSBT staking depends on the volume of WAVES-USDN swaps and a user’s staking balance’s share in the total amount of staked NSBTs. The Calculating Period is 1,440 blocks, which corresponds to approximately 24 hours. Upon the expiration of 1,440 blocks, swap fees begin to be distributed among NSBT stakers. The distribution system uses the IPB (income per block) parameter. To calculate it, Total Period Income (total income for the Calculating Period) is divided by 1,440 blocks:

IPB = Total Period Income / Calculating Period.

To calculate the IPB share (the share of income per one block), the distribution system determines the staking balance of each user in each block and divides this value by the sum of all staking balances:

IPB share = User Stake Balance in Block / Total Staked in Block

Consider this example:

Let’s assume the total income for the Calculating Period was 1,440 USDN. Then the income per block (IPB) will be 1 USDN. Imagine no one staked tokens between blocks 5,000 and 5,030. In this case, the income for these 30 blocks will be distributed among stakers in block 5,031. At the height of block 5,031, only Alice came in, which means she will get all rewards for the previous 30 blocks.

Alice’s income = 30 * IPB = 30 (USDN)

From block 5,031 to block 5,700, only Alice staked coins. This means she has a 100% IPB share over 270 blocks.

Alice’s income = 270 * IPB = 270 (USDN)

Between blocks 5,700 and 6,000, there were already two stakers: Alice and Bob. Alice staked 1 token, and Bob staked 3 tokens. Alice’s share of income per block = 1 / (1 + 3) = 0.25 or 25%, and Bob’s share = 3 / (1 + 3) = 0.75 or 75%. This means the rewards for these 300 blocks will be distributed proportionally between Alice and Bob.

Alice’s income = 300 * IPB * 0.25 = 75 (USDN)
Bob’s income = 300 * IPB * 0.75 = 225 (USDN)

There were already 3 stakers between blocks 6,000 and 6,440 as Carl joined.

Alice’s income = 440 * IPB * Alice IPB share = 440 * IPB * (1 / (1 + 3 + 150k) = 440 * IPB * 0.0000067 = 0.002948 (USDN)
Bob’s income = 440 * IPB * Bob IPB share = 440 * IPB * (1 / (1 + 3 + 150k) = 440 * IPB * 0.00002 = 0.0088 (USDN)
Carl’s income = 440 * IPB * Cai IPB share = 440 * IPB * (150k / (1 + 3 + 150k) = 440 * IPB * 0.9999733 = 439.988252 (USDN)

In total, per day (1,440 blocks):

Alice’s income = ~ 375 USDN
Bob’s income = ~ 225 USDN
Carl’s income = ~ 440 USDN

Thus, under certain circumstances, even by staking only 1 token, you can collect an income comparable to an income from staking 150,000 tokens. This example clearly demonstrates that, among other things, the system generously rewards those who stake tokens earlier than others.

Be the first NSBT staker

We are happy to announce a unique opportunity for our community to be among the first NSBT stakers and get rewarded accordingly. Protocol fees for swaps were introduced a week ago (November 25), and NSBT staking is only being launched today (December 3). Between these two dates, the NSBT pool accumulated about $245,000.

We are launching a special period during which you will be among the first NSBT stakers. The amount accumulated over the week will be distributed, in accordance with the algorithm described above, among those who will stake NSBT before the block 2,357,310 that is expected to be approximately on Friday, December 4, 08:00 AM (UTC).

The first Calculating Period will take place between blocks 2,357,310 and 2,358,750, which is, approximately, December 4–5. Accordingly, the first payout will take place on Saturday, December 5.

Don’t miss your chance to be the first!

About NSBT

Neutrino Token or NSBT (stands for Neutrino System Base Token) is a recapitalization and governance token for the Neutrino system. As a recapitalization token, NSBT ensures the stability of collateral reserves on Neutrino’s smart contract. New NSBTs are issued for locking WAVES on a contract, serving as additional backing and insuring the system against deficit. As a governance token, NSBT enables voting for issuing new Neutrino assets and updating protocol features and parameters. NSBT is also a stakable asset enabling holders to earn on WAVES to USDN swap fees. This article provides more information about NSBT token’s recapitalization and governance mechanics.

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