How to make money by investing on a Takamaka Node.
Takamaka is a Blockchain technology, backed by a PoS consensus algorithm, features two Tokens released based on certain dynamics and a network of Validator nodes and stakeholders who receive an incentive to support the network.
Thanks to Validator Nodes, the security of the Blockchain is maintained. Nodes commit TKG to become validators, while Stakeholders who bet on that node receive weekly interest just like node owners
Now we want to shed light on how TKGs and TKRs are generated and how they are distributed weekly to nodes and supporters, how many are needed to create a Node, and what is the ROI from investment.
Total TKG (Token Green) generated at the time of blockchain creation, in the ZERO block (cannot increase or decrease) : 99,000,000 (ninety-nine million)
These 99M were distributed in this way:
57%Token Sale: Available for sale
8% Early investors
4.5% Legal and other team
HOW PREMIUMS ARE PAID
Token Green TKG Distribution
The blockchain automatically releases 1 TKG with each block generated (so every 30 sec). Whether or not there are transactions on the block, that is, whether people are using the network or not, does not detract from this automatic release. If there are transactions on the network, in addition to 1 TKG released by the blockchain, the "validator" nodes (or verifiers since we are talking about Proof Of Stake) also receive the fees paid by users to send transactions on the Takamaka network.
TKGs automatically released by the blockchain are not part of the 99 M (see above) TKG Distribution.
The total amount of TKGs that the blockchain will automatically release is 105'120'00 (one hundred and twenty million). This figure was decided to ensure that for 100 years following the creation of the Takamaka blockchain, there will always be a "reward" (1 TKG) to be distributed at the time of blockchain creation (every 30 seconds).
How many TKGs will be in circulation in 100 years ? The exact number will be 105'120'000 + 99'000'000 = 204'120'000 (two hundred and twenty million).
TKR Token Red Distribution.
As for TKRs (Token Red), Takamaka decided to create 100,000,000,000 (one hundred billion) of them when the network was launched at block zero.
It is no longer possible to increase or decrease this figure.
TKRs have a stable value tied to the dollar, in a constant ratio of 1:1.
Since they are stable, they lend themselves very well to paying transaction costs on the network.
The TKRs spent by the user to pay for the transaction are automatically added to the continuous "reward" of the block ( one TKG ) in which the transaction was entered and divided equally among the people and nodes that validated that particular block.
- Users, once they receive TKRs, have two options:
- Keep them in their wallet to pay their transaction costs.
exchange them into FIAT money (EUR, USD, CHF) from AiliA
In Proof of Stake blockchains (such as Takamaka), unlike Proof of Work blockchains (such as Bitcoin), to be a validator, you don't need powerful computers or high electricity consumption'. In this case you just need to own TKG, to be committed to one of the nodes on the Takamaka network.
This in fact allows everyone to become part of the network, without excessive economic efforts related to expensive hardware infrastructure.
In Takamaka, block validation is done by Nodes. A node is actually a computer connected to the Internet that "owns" the entire history of the blockchain, from block 0 (zero) to the last block and continues to keep it updated as new blocks are created.
To be an active node, that is, a node that validates blocks, it must have a registered QTesla (Quantum Resistant) address and a stake (quantity of Token Greens pointed to the address) of at least 247'500 (two hundred forty-seven thousand five hundred) TKGs. The 247'500 TKGs can all be provided by a single owner, or by many different people ("pools") committing their Token Greens to the address of the node.
If anyone can point TKG to an existing node, why would anyone have an interest in creating a NODE and thus have a continuously connected computer ?
The difference is that the "reward" system is that the Node holder for just validating transactions always receives 20% of all the "reward" accumulated by the Node.
The reward for having validated the block is 1 TKG, + the fees paid by the user for all transactions entered in that block.
HOW IS THE PREMIUM TO NODES CALCULATED
The Staking premium is calculated as follows:
- Every 30 seconds a block (set of packaged transactions) is created that pays the validating node at least 1 TKG
- The time in the Takamaka blockchain is divided by EPOCH which corresponds to 8 days and 8 hours and thus 24,000 (twenty-four thousand) blocks. 24'000 blocks, means at least 24'000 TKG automatically distributed by the Takamaka blockchain to all nodes in the network. EPOCHs are important, because they represent the time interval that limits the change of bet by a wallet, from one validating Node to another.
- Those who own a Node receive at least 20% of the rewards processed by the Node, while the remaining reward (80%) is divided among the Stakeholders of that Node
- 247,500 TKG is needed to activate a node
In Takamaka, transactions have a standard cost, which is 0.07 TKR, so TXs are cheaper if paid with TKR
REWARD OF NODES: TWO PRACTICAL EXAMPLES
Let us now try to analyze TWO cases in which Nodes and Stakeholders are engaged on the network with some borderline cases and try to understand what the reward of the nodes, stakeholders and the economic commitment needed may be.
Bob installed a node but did not point to anything. All TKGs on Bob's node are in the possession of other people. Bob's node, being a "simple" node, confirms 120 blocks for EPOCH.
Imagining the most absurd case and that is that no one is using the network, thus 0 (zero) transactions/second, Bob would gain.
120 blocks X 1 TKG (block) = 120 - 80%= 24 TKG per EPOCH X 44 = 1'056 TKG/year
("44" are the EPOCHs created in one year )
Basically Bob earns 24 TKG (which is 20% of the node's rewards) every 8 days 8 hours, just by having the necessary infrastructure for a node even if he does not possess any TKG.
... Bob in one year receives 1,056 TKGs.
The remaining 80% is distributed as follows:
120 blocks X 1 TKG / block = 120 - 20%= 96 TKG per EPOCH X 44 = 4'224 TKG/year
("44" are the EPOCHs created in one year )
96 TKG (which is 80% of the node's rewards) is the reward per EPOCH, which will be divided among the people who support the node, rewarded proportionally to the amount' of TKG staked by the individual person.
In one year, the award is 4'224 TKG distributed to Stakeholders.
Bob does not want to build a node but wants to stake his 247,500 TKG on the Alice node. This is a node that validates 120 blocks for EPOCH and besides Bob, NO ONE ELSE has bet on the Alice node.
Suppose the network is working at 1% and all users are doing basic transactions (so token transfer transactions which are the least expensive) and using TKRs as their payment method.
A network at 1% means that 100 transactions are placed in a block, so the calculation to determine REWARD is:
120 blocks X 1 TKG / block = 120 - 80%= 24 TKG per EPOCH X 44 = 1'056 TKG/year
120 blocks X (0.07 TKR X 100 transactions) = 840 - 80% = 168 TKR per EPOCH X 44 = 7'392 TKR/year
Alice earns 24 TKG every 8 days 8 hours only by having the necessary infrastructure for a node although it has not committed any TKG.
Alice in a year receives 1'056 TKG with the network committed to 1%, 100 transactions every 30 seconds, receives 7'392 TKR.
120 blocks X 1 TKG/block = 120 - 20%= 96 TKG per EPOCH X 44 = 4'224 TKG/year
120 blocks X (0.07 TKR X 100 transactions) = 840 - 20% = 672 TKR per EPOCH X 44 = 29'568 TKR/year
("44" are the EPOCHs created in one year )
Bob, not having built the infrastructure for the node, but having only made a stake of 247,500 TKG, receives 96 TKG and 672 TKR per EPOCH from the node. This means that in one year he is "rewarded" by the network with 4'224 TKG and 29'568 TKR.
Through this post we have tried to give an explanation of the mechanism that allows a node and Stakeholders to evaluate the return on investment on the Takamaka network.
Specifically, we have proposed two cases, but in reality these could be many more and diverse, both because of the investment incurred to activate the node and because of traffic on the network that could very significantly affect the return.
In addition, and in a manner closely related to the performance of the TKG, in the exchange market, we can say that the fluctuations and gains could also be very different, moreover in the example we have taken into account a "simple" node, that is, a node that does not process smart contracts, but only transactions.