Introducing PoS Token: Proof of Stake smart contracts running on Ethereum
As the title suggests, today I’m going to be introducing a very interesting Ethereum based company, PoSToken: a proof of stake smart contract based token. As of this moment you may well be thinking “what on earth are you on about ‘proof of stake'” and if you are, I can’t say that I blame you. Let me elaborate on the matter.
Generally speaking cryptocurrency coins/tokens which are mineable (able to be collected/earned without financial investment) are so in one of two formats: PoW or PoS – sometimes a combination of the two. While PoW (Proof of Work) is an algorithmic system which rewards a ‘miner’ (a person/computer connected to the blockchain) for completing tasks on the blockchain, PoS (Proof of Stake) allows for a miner to be rewarded for simply holding their tokens in a wallet. Both algorithms have their benefits and purposes, neither is better, neither is worse.
To date, coins which are based on the Ethereum blockchain have only been mineable via the PoW algorithm which requires great computing power and consumes masses of energy, making it a very hit and miss method for many people within the cryptoverse who are not residing in a country with subsidised electricity costs.
PoSToken are presenting a change to the flow of the river so to speak. In creating the PoSToken standard the company has essentially coded a way in which Ethereum based companies can reward their investors without forcing them to dive into the world of huge electricity bills from running a miner 24/7, just to get a couple of tokens worth a dollar or two.
The idea proposed is that, should an investor hold their stake for a minimum set number of days, they will then begin earning extra tokens absolutely free of charge, up until the maximum coin age (90 days with PoSToken), without having to do anything more than holding their tokens in a wallet and activating the minting function of the smart contract. Essentially the system being proposed by PoSToken is one that will see Ethereum based investors becoming able to earn interest on their tokens as if they were holding a FIAT currency in a bank account.
The beauty with the PoSToken rests in the fact that, as mentioned above, they have created a standard which can be implemented by any company which operates on the Ethereum blockchain and is very easy to use for the end user.
While the standard is currently new and hasn’t bee adopted as official as of yet, there are other companies who have instantly started utilising it (Accelerator Token to name one) and the hope is that it will eventually be recognised with other Ethereum standards, such as ERC20.
Currently all tokens distributed from PoSToken have been issued for free, via an airdrop, and will have staggered maximum interest rates, which drop with time.
The announced plan is that within the first year all tokens will be able to mine 100% interest, meaning if you hold one token it will be able to mine one token extra. This is set to drop to 50% for the second year and then 10% for the third year until the fifteenth year.
After the final minting of PoSToken occurs there will be 10 million PoS tokens in existence, which all started with a pot of 1 million. As the concept grows and picks up in momentum you can expect to see PoS tokens being issued more frequently on the Ethereum blockchain and we will have one company to thank for that: PoSToken.
They are currently in their final round of free distribution so head on over to PoSToken.org to get yourself in on the action and begin minting.
- TOTAL TOKEN SUPPLY: 10m after 15 years
- AIRDROP TOKEN ALLOCATION: 1m
- MINABLE ALGO: Proof of Stake
- MINTING INTEREST: 100% within the first year, 50% within the second year, 10% from the third year
- MINIMUM COIN-AGE: 3 days
- MAXIMUM COIN-AGE: 90 days
- POSTOKEN WEBSITE: PoSToken.org
Please remember that this article is not to be taken as any form of investment advice and that you should do your own research before investing your hard earned cash into anything.