Another batch of NYM tokens don mature, but no changes to di parameters dey needed.
Nym na global privacy system wey dey powered by di NYM token. Di NYM token allow make virtuous cycle happen among users, token holders, and node operators of di infrastructure. E serve as utility token and also na means to measure mix node reputation and to reward operators and stakers.
Every quarter, di circulating supply of NYM tokens dey increase as vesting tokens dey release. Dis mean say more tokens go dey available for people to delegate stake to mix nodes and e go get effect say mix nodes go eventually reach stake saturation. (Stake saturation dey act like soft cap to ensure say no individual node get too much power over di mixnet). Usually, when vesting happen, di parameters suppose change so dat enough number of mix nodes go reach stake saturation.
So far, di recent vesting wey happen no really cause large increase for staked tokens. For dis quarter, overall staking activity dey far from di target staking supply. Based on dis, no need make dem adjust di parameters. To sum am up, di current parameters be:
Parameters
Circulating supply: 473 million NYM (API)
Locked staking supply: 29 million NYM
Max staking supply: 502 million NYM
Target staking supply: 225 million NYM
Mix node stake saturation point: 940k NYM
Deep dive
Di circulating supply as at di time wey dem write am na 473m NYM. In addition to di circulating supply, 10% of di 29m unvested (locked) native NYM tokens fit also dey delegated as stake to Nym mix nodes.
Dis mean say di maximum amount of NYM tokens wey fit dey staked = 473m + 0.1*294 = 502 million.
But di actual number of tokens wey dey staked for now na 150 million, e mean say 30% of total supply dey staked.
Dem set ‘target staking supply’ to dey below di maximum (wey be 502 million) circulating NYM tokens, because e no go dey possible for all of these tokens to dey staked.
Dem set di target staking supply parameter to maximise APY, or rate of return, for tokens wey dey staked, but still dey encourage more staking. E suppose dey set somewhere between di maximum staked tokens (502m), and di current level of staked tokens (150m).
If dem set target wey dey lower pass di current level of staked tokens, e fit discourage both staking and operating of saturated node. Di saturation levels of a node dey show its reputation, and e affect whether di node go dey part of di active set (or ‘epoch’) for di mixnet, and how e go dey earn rewards. If all nodes dey reach saturation too easily because di target dey very low, di incentive algorithm no go work again, and staking go lose im importance for di selection process.
But if dem set di target way higher, e fit raise di saturation point to unreachable levels. E go affect APY of mix nodes and discourage operating and staking.
So, to offer good APY to operators and stakers, dem set target staking supply for rewards higher pass di current level of staked tokens, but lower pass di current maximum of 502m, and e dey set at 225m.
Dem go need increase dis target when di level of staking for di mixnet dey approach di target. Normally, di number go increase as rewards dey release every month, and especially with di quarterly vesting, as e dey release plenty tokens wey fit dey staked. But di current staking level (150 million) still far from current target (225 million). Because of dis, dem no need increase am immediately, so di parameters go remain unchanged.
Also, this one mean say di stake saturation point no increase with dis vesting. Dem dey find di stake saturation point by dividing di target staking supply by di number of mix nodes wey dey get rewards: 225m / 240 = 940k saturation point.
Dem go review di parameters again when di next vesting happen to know if total staked tokens for di network don reach di target.
Over di next few months, dem go make some improvements to Nym token economics, including minimum profit margin, and more opportunities for mix node operators. Stay tuned for updates!
For full explanation of Nym token economics and di smart contracts wey dey foundation for Nym, click here. You fit learn more about Nym and token economics: read di token economic whitepaper, bonding and delegating NYMs as stake to earn rewards, and read di guide to bridging NYMs. You fit find Nym Developer Portal here.
