RWA Incentives
Staking Score
The staking score within the OAE framework is a dynamic metric and is derived from the average amount a user has staked over the last 12 months.
Lockup of RWA tokens provides an instant increase in that score reflecting the lockup period, followed by the pause of the staking score accrual that lasts until the end of the lockup period (unless the maximum duration of 12 months is chosen in case of which he instant gain of staking score is equal to the maximum achievable gain for the given locked amount).
Example 1:
User locks in 1200 RWA tokens for a month. His staking score instantly increased by 120. Following this initial period, the staking score remains static for the next month (unless other staking deposits are made). Once the 1 month lockup period is over, the lockup will be automatically converted to standard staking and over the subsequent 11 months, the score will gradually increase from 120 to 1200, aligning with the total staked amount.
Example 2:
John consistently stakes 1000 RWAABC tokens over a year. With a staking score based on a 12-month average, John’s score equals 1000. Matthew, attempting to quickly boost his score, stakes 6000 RWA tokens for a month, achieving a staking score of 500 (6000/12*1) Despite Matthew's larger stake, John's longer-term commitment yields a higher score, illustrating the system's preference for sustained staking. |
Key Points to Note:
Users can increase their stake at any time.
Withdrawals must encompass the entirety of the staked amount; partial withdrawals aren't allowed, to prevent gaming the system.
Withdrawing resets the staking score to zero.
Users may initiate multiple lock-ups, subject to a minimum staking threshold for each.
Lock-up periods can be upgraded to extend the duration, which resets the lock-up timeframe.
Lock-ups operate independently from standard staking and from one another. Users can hold multiple distinct lock-ups, such as 1000 RWA for 1 month and 5000 RWA for 6 months. Each lock-up can be exchanged or ended early on its own.
The staking scores from various vaults accumulate, reflecting the total RWA staking score associated with a user's Xend ID.
The following 3 tables illustrate how staking score behaves in different scenarios - standard staking, 6 month lockup and 12 months lockup.
Month | Total Staked | Staking Score |
1 | 1000 | 83.3 |
2 | 1000 | 166.7 |
... | 1000 | ... |
12 | 1000 | 1000.0 |
- Standard staking - staking score accrual
Month | Format | Deposit amount | Lockup time | Staking score | Event |
1 | Lockup | 1000 | 6 | 500 | Instant gain of staking score |
2 | Lockup | 1000 |
| 500 |
|
3 | Lockup | 1000 |
| 500 |
|
4 | Lockup | 1000 |
| 500 |
|
5 | Lockup | 1000 |
| 500 |
|
6 | Lockup | 1000 |
| 500 | Conversion to standard staking |
7 | Lockup | 1000 |
| 583.3 |
|
8 | Standard staking | 1000 |
| 666.7 |
|
9 | Standard staking | 1000 |
| 750 |
|
10 | Standard staking | 1000 |
| 833.3 |
|
11 | Standard staking | 1000 |
| 916.7 |
|
12 | Standard staking | 1000 |
| 1000 |
|
- Statking score accrual in 6 month lockup
Month | Format | Deposit amount | Lockup time | Staking score | Event |
1 | Lockup | 1000 | 12 | 1000 | Instant gain of staking score |
2 | Lockup | 1000 |
| 1000 |
|
3 | Lockup | 1000 |
| 1000 |
|
4 | Lockup | 1000 |
| 1000 |
|
5 | Lockup | 1000 |
| 1000 |
|
6 | Lockup | 1000 |
| 1000 |
|
7 | Lockup | 1000 |
| 1000 |
|
8 | Lockup | 1000 |
| 1000 |
|
9 | Lockup | 1000 |
| 1000 |
|
10 | Lockup | 1000 |
| 1000 |
|
11 | Lockup | 1000 |
| 1000 |
|
12 | Lockup | 1000 |
| 1000 |
|
- Satking score accrual in 12 month lockup
RWA Levels
Increasing staking score unlocks higher 'RWA level' associated with Xend IDs. There are 10 RWA levels, and the benefits of advancing through them include:
Discounts and bonuses in the OAE environment.
Access to exclusive features.
The eligibility to act as :
Service Provider in the Social Hub.
IAC provider.
Asset Chain validator.
A range of benefits and enhanced rewards.
Please refer to the table on the next page providing a comprehensive overview of anticipated staking score requirements for RWA levels and benefits associated with them.
RWA level | Staking score | Social Hub Provider Account Access | IAC provider Account access | OAE transaction fees discount | Xend Solutions fees discount
| Cashback (Xend Card, NodePay) | P2P max loan limit (borrower and lender) | Initial Premium MPG | GOR API discount | Fundraiser account access and fundraise limit | Validator Account Access |
1 | 1 000 | - | - | 2% | 1% | 0.5% | $1 000 | $0.01 | 5% | - | - |
2 | 2 500 | - | - | 4% | 2% | 1% | $2 500 | $0.015 | 10% | - | - |
3 | 5 000 | - | - | 6% | 3% | 1.5% | $5 000 | $0.002 | 15% | - | - |
4 | 10 000 | Standard account | - | 8% | 4% | 2% | $10 000 | $0.025 | 20% | - | - |
5 | 15 000 | Standard account | - | 10% | 5% | 2.5% | $15 000 | $0.03 | 25% | $25 000 | - |
6 | 25 000 | Standard account | - | 12% | 6% | 3% | $25 000 | $0.035 | 30% | $50 000 | - |
7 | 50 000 | Standard account | - | 14% | 7% | 3.5% | $50 000 | $0.04 | 35% | $100 000 | yes |
8 | 100 000 | Premium account | Standard account | 16% | 8% | 4% | $100 000 | $0.045 | 40% | $250 000 | yes |
9 | 200 000 | Premium account | Standard account | 18% | 9% | 4.5% | $200 000 | $0.05 | 45% | $500 000 | yes |
10 | 400 000 | Premium account | Premium account | 20% | 10% | 5% | $400 000 | $0.055 | 50% | No limit | yes |
- RWA levels and related benefits
Note: Xend Solutions fee discount encompass:
Xend Exchange order book discount on maker and taker fees
Xend Exchange liquidity pool discount on LP fees
Off/on-ramp fees
Banking fees
Omni-bridge fees
RWA Rewards & Logarithmic Distribution
Xend Finance will secure a specific portion of its current total RWA supply to fund a new RWA staking rewards initiative (the exact amount is yet to be announced separately). These rewards will be distributed proportionately among stakers, based on their staking score.
The reward distribution follows a logarithmic curve, ensuring a gradual reduction in the reward amount by a predetermined percentage (e.g., 0.3%) after each distribution epoch. This approach guarantees a sustainably decreasing rewards curve without the need for manual adjustments by the Xend Finance team, theoretically allowing for an infinite reward distribution timeline.
Please refer to the chart below visualizing how RWA rewards distribution would be like assuming weekly distribution epochs, with a decrease rate of 0.3% per epoch, and beginning amount of distributed RWA tokens set to 100 000.
The rewards curve, designed to be theoretically infinite, can extend for many years. It will continue until the total rewards available are too low to cover transaction fees (gas costs), at which point the distribution pauses until the rewards pool is refilled. The example model above visualizes a successful distribution of approx. 31.6 million RWA tokens over 2.5 years.
Key Points to Note:
A reduction in the total reward amount of rewards distributed does not directly imply a decrease in the Annual Percentage Rate (APR) of rewards. Should some users withdraw their stakes, the competition for rewards lessens, potentially increasing the APR for remaining participants.
This system introduces a self-regulating economic model that naturally adjusts to offer a fair rewards APR, aligning with market expectations and maintaining equilibrium among stakers.
The reduction in the quantity of distributed tokens is potentially neutralized by future increases in the market price of RWA tokens. This means that although stakers may receive fewer tokens over time, the economic value of these tokens could remain stable or even increase, counterbalancing the decrease in quantity.
Validators Revenue
In addition to staking rewards, validators will participate in distribution of RWA transaction gas fees generated on Asset Chain and Xend Connect.
This model diverges from traditional blockchain practices, as fees collected from these transactions are first accumulated in the Xend Finance treasury before being periodically distributed to validators. The allocation to validators is influenced by their staking scores, performance and dependability of their nodes, focusing on metrics like uptime and validation quality.
Utilizing time-based participation metrics, the validators' revenue distribution system is structured to discourage validators from setting up their nodes just before an impending revenue distribution. This ensures a fairer and more equitable allocation of rewards, based on longer-term participation rather than strategic timing.
It's important to highlight that a single Xend ID can operate multiple independent nodes, provided the PoS staking requirements are met, potentially enhancing the validator's revenue and staking rewards.
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