Minter Hub Tokenomics

Minter Hub Tokenomics

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Tokenomics describes economic principles within a blockchain using tokens, in this specific case — HUB.

For 2021, the team sees 3 main paths for improving the blockchain economy: staking, fee discounts, tips.

Staking

Oracles of Minter Hub stake their own HUB a.k.a. confirm the honesty and reliability of transaction processing and creating blocks with their own money. For these risks (and it is a risk), oracles receive a reward in the form of 1% of fees for all cross-chain transfers. The fee is collected on deposits and withdrawals. For example, if a user makes a transfer of 100 USDT from Minter to Ethereum, 1 USDT will be sent to oracles proportionally to their stake on Minter Hub. The fees are paid out on Minter in transferred tokens.

Any user or HUB holder can delegate it to oracles to make money off of it.

The list of oracles and delegation conditions can be found on this page.

Let’s look at an example of oracle profitability with staking.

Input data:

  • 1 HUB costs $100
  • The total oracle stake is 20 000 HUB
  • There are 16 oracles
  • Daily cross-chain transfer volume is $1M
  • Transfer fee is 1%

This means that the total daily income of oracles is $10 000 (1% of $1M). The total price of oracles’ stakes is $2M (20 000 HUB $100 each). That means every oracle, dependent on their stake, has a wonderful profitability of 0.5% ($10k / $2M) daily and 182.5% yearly. That makes this kind of income quite attractive. That’s why many users and oracles are trying to quickly raise their HUB assets, which makes the token go up in value, but also reduces the profitability.

Let’s see an example where HUB staking would bring its price up to $1 000.

Input data:

  • 1 HUB costs $1 000
  • Total oracle stake is 20 000 HUB
  • There are 16 oracles
  • Daily cross-chain transfer volume is $1M
  • The transfer fee is 1%

In this case, the total stake price for the oracles is $20M and the yearly profitability has gone down to 18.25%, which follows the profitability of DeFi markets and surpasses the indicators of the traditional market by approximately 10 times.

But these are mere examples where the 1% transfer fee is included, but you can also get discounts!

Discounts

Lowering oracle profits from fees is a strong incentive to increase demand for HUB, raising their stake prices. It provokes competition for blockchain validation, which makes people put more care into their responsibilities.

HUB allows for cross-chain transfer fees among Minter, Ethereum, and Binance Smart Chain to be lowered. Since one seed phrase controls three addresses, it’s been suggested that those who hold HUB on any of them get lower fees. In the basic scenario, the fee stands at 1% for any cross-chain transfer, but the possession of tokens from now on will give a certain discount:

  • 1 HUB — 10%
  • 2 HUB — 20%
  • 4 HUB — 30%
  • 8 HUB — 40%
  • 16 HUB — 50%
  • 32 HUB — 60%

If you have 16 HUB on your balance, when transferring USDT from Minter to Ethereum, you’ll be paying a fee of not 1% but 0.5%.

Discounts are especially beneficial to liquidity providers, who will be doing many, many transfers and swaps. At a maximum discount (requiring possession of 32 HUB), transferring ETH from Ethereum to BNB on Binance Smart Chain will cost only 1%:

– Transferring ETH to Minter — 0.4%

– Trading ETH-BNB on Minter — 0.2%

– Withdrawing to Binance Smart Chain — 0.4%

In the end: 1% for the fastest and most reliable swap from one blockchain to another. No alternatives.

These economic politics will encourage users to hold HUB on their addresses for the longest period possible: buying tokens early and not selling them because with a limited supply of 1 million tokens, there will be no second chances for getting a discount. If at the start of March with a HUB price of $3, you could get a max 60% discount for just $96, then three weeks later that would have cost you $2 500.

Tips

The world’s had all kinds of private clubs for a while, where successful traders and financiers share their thoughts, give recommendations, and advise on all types of financial activity, mostly about the best time to buy one asset or sell another.

In DeFi (decentralized finance), there’s a new unique possibility to track not only recommendations, but also the actual actions of those professionals: what assets are at play (buying/selling), when and in what volume.

On Minter Hub, there’ll be an option to get tips on the whole spectrum of financial services — from trading and controlling liquidity to loans and investments. The most important part is that you can partake in the most profitable deals in all three networks, managing money from one app (Honee) that lets you see the most profitable deals on any of the networks by simply pressing on any of your tokens. HUB holders will receive tips automatically when one of the top traders or financiers makes a potentially beneficial transaction with top-level tokens or leading projects and protocols. Tips will be available to any community member that has at least 1 HUB on any of the networks.

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Users can repeat deals, receiving all data about how successful the trader was, which can be tracked weekly, monthly, or quarterly, what portfolio they control, what kind of activity they prefer.

The three spheres of HUB — staking, discounts, and tips — all create a demand for a very limited coin supply (1M total, with the possibility of burning), laying a foundation for the blockchain to prosper and with it, the well-being of Minter users.

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