UTXO Staking on Steroids

** New Concept - Possible to include this in Next Mandatory Upgrade (July 2021) **


So Togo and I were chatting today about HEX's features and trying to come up with two more positive elements for BiblePay that addresses: Referrals (1), and Mass Adoption for Stakers (2).  (Hex currently has 1B$ staked and we were looking at some of their network rules to see if any make sense for us).  This proposal does not address Referrals, it is simply about mass adoption rules.

One pro for Hex that Togo pointed out is that they make you lock your funds up for a designated time period, and they burn them (like we used to do with DWS).  Meaning that you cannot take it out early.  If you insist on pulling out early there is a very heavy catastrophic fee levied on your original capital.

To lay the known groundwork, we already have an established dynamic DWU (rate of return annualized) set up with UTXO staking based on how many participants are in the leaderboard each day with stakes.  Right now its 14% for BBP-only and 28% for bbp+foreign.

So what I was thinking is why don't we offer a DWU bonus % of up to 2* your normal return, in exchange for locking up the coins with a penalty if you unlock them early.

Lets look at two scenarios, Scenario A is a user who decides to go the conservative route and does not want any penalties (this is our default):

Scenario A (conservative user):
Locks up 1MM BBP + $200 of LTC for a 28% DWU reward.
They get paid 28% annualized on a daily basis.  If they quit early (spend the stake) there is no penalty.

Scenario B (High reward user):
Locks up 1MM BBP + $200 of LTC for a period of 1 YEAR.  This yields 56% (a 2* multiplier is given for the longest term, 1 year.  A 1.5* for 180 days.  A 1.25* for 90 days).
If they successfuly hold the stake for over 365 days there is no penalty.
If they pull out in 180 days, they must pay the network fee of 28% (this is the extra component they were receiving rewards on!). 
We would charge a fee of 280,000 bbp payable to our BURN address.  This BBP would be destroyed (just as HEX does), to make our supply smaller.
This helps FUND the operation for when we pay out higher ROI to others.

You may ask, how do we enforce this if the original coins are not burnt?

We would accomplish this by making a new network rule that requires all transactions sent spending a UTXO would be reviewed, and if a FEE is owed, the FEE is levied to the BURN address.  If it is not spent in a transaction (as the UI will auto-calculate) that transaction will not be mineable, or spendable.  If however they PAY the fee in the TX, it will go through.

So for example, if John Doe tries to send this tx to an exchange, The original 1MM would end up being 750,000 for example.

I think we should make a poll on this idea also!

This might be a good way to really attract new users as high rewards are free word of mouth advertisements.

A hybrid system like this would be intresting.   

I would say it sounds abit like a hybrid between cardano and ethereum staking in that one have lock up period and one does not.

Yeah i mean alot of us biblepay users are primarily holders, getting coins  and not selling.

If scenario A+B  goes the same time  i think it looks fine. Still having the option for not having to lock up longer periods i think its important (like we have now).
Other thoughts, yeah looks good if we could implement  side by side with current UTXO staking method. Another choice is all good to have.

A hybrid system like this would be intresting.   

I would say it sounds abit like a hybrid between cardano and ethereum staking in that one have lock up period and one does not.

Yeah i mean alot of us biblepay users are primarily holders, getting coins  and not selling.

If scenario A+B  goes the same time  i think it looks fine. Still having the option for not having to lock up longer periods i think its important (like we have now).
Other thoughts, yeah looks good if we could implement  side by side with current UTXO staking method. Another choice is all good to have.

Great points.  Yeah, I was envisioning leaving the system we have as the "conservative" system, and adding the high-yield (or high-risk) system in as an "option" for our investors.

I am thinking what we can do is add an additional argument to easybbpstake (and to easystake) called 'lock_duration'.  If its 0, it becomes a conservative stake with no chance of a penalty (but a lower reward).  If you set the days, then your stake is locked and subject to a penalty if you unlock it.

Im working on it now in testnet; we can test this baby out tomorrow.

Thanks for the great advice.

PS:  We still need a system for referrals.  We should brainstorm on that.  I either have no clue how Hex does that, or forgot.  If anyone has any advice on referrals, please let us know.

HEX Referrals

- Adoption Amplifier (lasted for 1st year)
Users exchange ETH for HEX on website that interacts with smart contract
If the user has a cookie with a referral, they get 10% bonus HEX
and the referrer gets 20% bonus HEX

https://freebitcoinhex.com/claim/hex-referral-link-generator
https://twitter.com/hexcrypto/status/1114727913977413632

[I made like $300 from doing this, staked it for 10 years, its worth over $10,000 now]


- Staker.app
Referrer gets 0.4% and 40 cents of each stake, transfer and swap, up to certain limits
https://medium.com/stakerapp/introducing-staker-31cdb7151fcf#8da5
https://kmphua.medium.com/how-to-get-your-staker-referral-qr-code-75e31e873765
(This one is kind of stalled due to cost to get gnosis safe, $30 (really $100 but someone is helping cover cost), and sadly theres no auto way to get it right now, they havent built/released shop yet, they only have a form you can fill out and then send them crypto to get it)


- HexRef.win
Referrers receive a minimum of 0.1% staking interest, can set up to 50%
(So you don't get paid until the stake ends?, I havent seen anyone use this one yet)


- HexBay.win
Referrer gets a 4.7% cut of the initial stake
(Code in queue for audit, and not publically released yet)

HEX Referrals

- Adoption Amplifier (lasted for 1st year)
Users exchange ETH for HEX on website that interacts with smart contract
If the user has a cookie with a referral, they get 10% bonus HEX
and the referrer gets 20% bonus HEX

https://freebitcoinhex.com/claim/hex-referral-link-generator
https://twitter.com/hexcrypto/status/1114727913977413632

[I made like $300 from doing this, staked it for 10 years, its worth over $10,000 now]


- Staker.app
Referrer gets 0.4% and 40 cents of each stake, transfer and swap, up to certain limits
https://medium.com/stakerapp/introducing-staker-31cdb7151fcf#8da5
https://kmphua.medium.com/how-to-get-your-staker-referral-qr-code-75e31e873765
(This one is kind of stalled due to cost to get gnosis safe, $30 (really $100 but someone is helping cover cost), and sadly theres no auto way to get it right now, they havent built/released shop yet, they only have a form you can fill out and then send them crypto to get it)


- HexRef.win
Referrers receive a minimum of 0.1% staking interest, can set up to 50%
(So you don't get paid until the stake ends?, I havent seen anyone use this one yet)


- HexBay.win
Referrer gets a 4.7% cut of the initial stake
(Code in queue for audit, and not publically released yet)

Thanks Togo!

This is pretty interesting stuff.

Let me cut right to a 'theretical' idea for BBP then let you and others improve this idea.

Lets hypothesize that an existing high-yield BBP staker could create a 'stake-code' by running an RPC command.  Their impetus of course is that if this code gets used by someone else, they would receive 10% of the *other persons* new UTXO reward as a reward for referring people to our project.
The impetus for a new user to use a code vs. not using a code is they receive an extra 10% staking reward when using a code.

So John Doe generates a referral code in the RPC.
John shares this with Alice.

Alice stakes 1MM bbp at 30% DWU using Johns referral code.  In the leaderboard, she receives 40% because she is a new user with a code.
Johns position increases by 1MM (and 10%) because Alices' stake is active and not-spent.

Everything looks cool and possible so far.

But my question to you guys is how do we prevent fraud.
What if Alice creates a code on one computer for herself, and uses it herself from another CPK just to get a total "20% edge" above everyone else and in reality she is not a new user.

How do we remove the fraud possibilities?

I think I have a way (for BiblePay) to accomplish this all credit to Jesus.

What we can do is allow a person with an established leaderboard position, to generate referral codes (in denominations they specify, IE 10K, 100K, 1MM) good for up to a total of 10% of the position value they currently have on.  (Another words, if a person has 10MM in stake, they can generate up to 1MM in referral codes, in any denomination but may not exceed 1MM even if they generate 10 for 100K each. 
Rule 2: In order to receive rewards on their own portfolio, a different CPK must cash in the referral code (so one CPK can never use a referral code generated by themself).

What this does is limits the 'edge' received by referral codes using a law of diminishing returns.  Worst case scenario is a very greedy person would print one out for themself (for 10% of their portfolio) then stake with that code in a new wallet.  That would quickly end the cycle when the new wallet could only generate 1% of the original size.

In addition people would have a propensity to share referral codes to solidify the strength of biblepay as a whole (after all who wants a weak coin when they go to sell in the future).
I think with these 3 elements, it would pretty much address the abuse vector.

So in reality, people will be sharing codes all over the place.  The other rule is, if you use multiple codes yourself you may not accumulate more than 10% of high-yield staking based on codes (IE if you have 10MM in stake, and copy codes from trollboxes, you cant cash in more than 1MM in codes as that would be the limit per user and they would stop working after that limit).

Good system?

Just to clarify, when a code is used, both the originator and the new-user get to benefit from the code (by 10% of that portion of each of their portfolios).

So I feel like these two elements could provide biblepay with phenomenal growth, if they catch on.

First we have high-yield (or high-risk) staking.  This gives you an extra 1.01-2.0* modifier on your position if you lock your coins up in high-risk mode, and agree to a penalty if you unlock them.  This is being merged into testnet now (see our harvest thread) for testing.

Second we have BiblePay Referral Rewards:
https://wiki.biblepay.org/Referrals

This addresses the method in which biblepay staking could provide viral referral PR.  This is also going into testnet now.  If testing passes, we can have these things in our July release.

Very cool!!! Wow! Great job Rob!! 

What this does is limits the 'edge' received by referral codes using a law of diminishing returns.  Worst case scenario is a very greedy person would print one out for themself (for 10% of their portfolio) then stake with that code in a new wallet.  That would quickly end the cycle when the new wallet could only generate 1% of the original size.

I'm often impressed with your clever solutions. I also thought about the fraud angle as soon as you mentioned referrals and this seems like a good way to reduce fraud and at most you can earn 10% off your own BBP. Great job!




Is 2* is the most you'd consider? What if someone really believes in the project and wants to stake for 2 years, 3 years, 5 years, or even 10 years like Togo did with HEX?

I'm often impressed with your clever solutions. I also thought about the fraud angle as soon as you mentioned referrals and this seems like a good way to reduce fraud and at most you can earn 10% off your own BBP. Great job!




Is 2* is the most you'd consider? What if someone really believes in the project and wants to stake for 2 years, 3 years, 5 years, or even 10 years like Togo did with HEX?

Thank you Sun for the compliments about the referral idea.  Hopefully it provides enough viral PR for us during the next release to remove the necessity to pay a promotional budget, and it satisfies the more conservative users (in that we arent wasting precious coinbase rewards unecessarily) etc.

I am actually quite intrigued by this idea of ultra-long-term-staking.  Im not really against the 5,10,30 year.  Its almost as if it becomes a 'bond' in the sense that treasury bonds work, you save up for a bond for your child, and with the faith in the bearer being in business in for example 30 years, they end up with quite a way finance their future etc. 

Imho, I think we should test the waters with this next release first and make sure we dont get any complaints from conservative people that the ultra-long term stakers are taking too much of the daily GSC reward.  But also I think if every goes smoothly and we are on a positive trajectory later this year I think we can vote on it and potentially do it.