Jan 19, 2022
Umbrella Network’s rUMB1 To UMB Conversion: A Primer
rUMB tokens serve as the reward tokens from Umbrella Network’s staking program. Here’s how they work and what you can do with them
Let’s start with what an rUMB token is
When you stake your UMB tokens (either BEP20 or ERC20) on Umbrella Network’s Staking Platform, the rewards that you get, are rUMB tokens.
These rUMB tokens can be redeemed for UMB tokens on a 1:1 basis, on the achievements of certain milestones. The first such milestone was revealed here. This would unlock the ability to redeem rUMB1 to UMB on a 1:1 basis.
The 1 in rUMB1 simply denotes the upcoming achievement milestone/period. For example, if the Umbrella Network staking platform is emitting rUMB1 tokens, it simply means that the upcoming achievement milestone is the first-ever.
Similarly, after the first conversion event is triggered, Umbrella Network’s staking portals will cease generation of rUMb1 and new ones will begin emitting rUMB2 tokens (rUMB tokens are emitted as ERC20 on the ETH network and as BEP20 on the BSC network).
All rUMB tokens, irrespective of whether they’re rUMB1 or rUMB2 or rUMB3, can be exchanged for UMB tokens on a 1:1 basis — after their respective achievement milestones are reached.
The goal of the rUMB token is two-fold. They are distributed to token holders in the community who stake on our Streams as a reward for longer-term holding. They are also meant to pave the ground for the rollout of DPoS (Delegated Proof of Stake) in the near future where you would be able to earn a share of fees by actively staking in the validator pools.
Prerequisite: All rUMB to UMB conversions will occur only on the Ethereum Blockchain. If you hold rUMB on Binance Smart Chain, you will need to bridge them over to Ethereum before you can claim for UMB.
What Can You Do When The rUMB1 to UMB Achievement Milestone is Triggered?
When the conversion event kicks in, the following will come into play:
- Hadley Stream 2.0 and Polar Stream 2.0 will go live and start emitting rUMB2 tokens as staking rewards to those who stake in these two staking pools (post-audit from Certik)
- Hadley Stream 1.0 and Polar Stream 1.0 shall cease emitting rUMB1 tokens (when 2.0 streams go live) but continue to be online. If you do not claim/withdraw your UMB and rUMB1 tokens, they’ll safely sit there albeit not earn any staking rewards anymore
Thus, to continue earning rewards, you are advised to claim all your rUMB rewards, unstake your UMB from the 1.0 staking streams, and re-stake them on the 2.0 streams.
These are the options that you can exercise at/after the conversion event:
- Convert rUMB1 to UMB on a 1:1 basis
- Stake rUMB1 to get rUMB2
Let’s go over each of them and understand what happens when you choose to exercise either of these options.
Convert rUMB1 to UMB on a 1:1 basis
Choosing this option shall convert ALL your rUMB1 reward tokens to ERC20 UMB tokens on a 1:1 basis.
The redeem function is predicated on the all-or-none law. This means that you can either choose to redeem all of your rUMB tokens for UMB or, none at all, per wallet. (For those holders with amounts larger than the daily quota, you would potentially have to split a smaller amount into a separate wallet to redeem.)
Theoretically, a max of approximately 201,368 rUMB can be converted to UMB in one go. This number was derived by doubling the daily emission rate of rUMB on the ETH network. If you attempt to convert your rUMB1 to UMB and the system tells you that the quota has already been exhausted, you simply need to wait for the quota to replenish.
The quota is linear and replenishes at a constant rate until it reaches the limit of approximately 201,368.
This means that if somebody wanted to redeem 202k rUMB, they’d be unable to do so, in one shot, but those looking to convert 1k, 5k, and 10k rUMB would be able to do so easily.
This system will favor smaller wallet holders in the initial period, with the quota trending lower than the max cap as smaller holders claim their tokens.
After redeeming your rUMB1 tokens for UMB tokens 1:1, you can then choose to re-stake them on our 2.0 streams (ETH or BSC network), simply HODL, or sell them in the open markets.
Stake rUMB1 to get rUMB2
We’re also launching a Brand new staking vault with premium APR% for those rUMB1 HODLers that do not wish to convert their rUMB1 tokens to UMB tokens — but want to continue generating staking rewards!
The new rUMB1 staking vault comes with a lockup period, either 6-month or 12-month, with an APR% Multiplier in effect to provide a premium for those who choose to stake their rewards tokens long-term. Those who stake rUMB1 will receive rUMB2 as the rewards token. The principal staked will remain locked for the chosen period, but the rUMB2 rewards can be claimed at any time.
Note: To stake rUMB1, you need to have them in your wallet and not pending in the staking pools.
What Happens If You Do Not Claim Your rUMB1 tokens? Will they expire?
No.
On the day the conversion event is triggered, the current Polar 1.0 and Hadley 1.0 Streams would simply cease to emit rUMB1 tokens. All your staked UMB and earned rUMB would sit there safely.
It is our suggestion to redeem and re-stake them on the new Polar 2.0 and Hadley 2.0 Streams as those will start emitting rUMB2 rewards so avoid missing out on continued rewards distribution.
So, the key takeaway is, unless you’re stuck on a remote island with no Internet (or if the GAS costs become atrociously ridiculous), you’re better off either
- Withdrawing your rUMB1 if you haven’t already done so and redeemed rUMB1 to UMB OR
- Staking your rUMB1 into our new lockup rUMB1 lockup vaults to get rUMB2 with a higher APR%.
A note for those who staked UMB on CEXs such as AscendEx: Since our conversion portal needs to be connected directly with your Metamask (or the other supported wallets), you will need to transfer your UMB to one of these wallets on the ETH network, to be able to trigger the rUMB redemption process
About Umbrella Network
Umbrella Network is a scalable, cost-efficient, and community-owned decentralized oracle that is LIVE on BSC, ETH, Polygon, and Avalanche mainnets. dApp developers on all supported Blockchains can directly call data from our decentralized oracle, into their smart contracts.
Umbrella Network is the largest decentralized oracle by transaction volume, by the number of data pairs supported, and by the comprehensiveness of available data sets.
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