$QSK token economy of Quicksilver project
Quicksilver is a standalone Cosmos-SDK chain for Interchain that offers liquid stacking and at the same time is free from existing restrictions on liquid stacking. Due to its design, it is scalable to deploy an unlimited number of projects without the need for projects and validators to exert effort to participate.
Quicksilver is controlled by token holders, and all decisions regarding the future of the protocol (control parameters, acceptance of new projects, distribution of incentives, etc.) are determined by the community. In this article, we will look at the economics of the Quicksilver token, QCK.
Design philosophy
• Adaptive token economics
Instead of a rigid inflation and output schedule with a predetermined distribution, the $QCK token aims to become an adaptive token that responds adequately to market and ecosystem conditions. As such, we expect protocol governance to play a major role in determining the future of the $QCK token. There will be periodic community discussions to determine the course of the token and consider suggestions from the community.
• Distribution
The QCK token represents ownership of the Quicksilver protocol, and it is therefore important that the token is well distributed to the community of established chains on Quicksilver. The protocol has several mechanisms to ensure overlapping incentives and ownership between Quicksilver protocol users and $QCK token holders.
• Token utility
Quicksilver’s native token, $QCK, performs the following functions: management, security, payment of fees.
• Governance
Governance is the most important component of the Quicksilver network. Incorporating new regions and related incentives, spending community-controlled funds, changing network parameters and controlling the upgrade process are all activities carried out by governance. Holders of $QCK tokens can use their assets to vote on behalf of the future protocol.
Security
$QCK token holders can use their assets to secure the Quicksilver chain by delegating their assets to validators who allow tokens to be put on the map to achieve PoS consensus.
The Quicksilver team is considering switching to Interchain Security v3 if it makes economic sense. To avoid time constraints, the Quicksilver chain will run as a separate Cosmos-SDK chain. Once Interchain Security v3 is available, possible use of this feature will be in the hands of the Quicksilver community through management.
Payment of fees
In addition, the $QCK token is used to pay fees for transactions on the network. These fees are paid to block producers on the network to ensure that the transaction is included in the block.
In addition, $QCK stacking allows for the permanent remuneration in Quicksilver’s own resident blockchain tokens. Initially, this allows $QCK stackers to passively earn tokens such as Atom, Osmo and Juno. However, a $QCK bet will soon earn rewards in every major Cosmos asset that currently exists or will appear in the future. These passive rewards are generated by fees from betting rewards that Quicksilver receives. All income generated by the protocol is distributed to the stakeholders of $QCK.
Inflation calendar
The QCK token will be subject to annual inflation until it reaches a maximum supply of $720m. The inflation rate will be 65% in the first year, then it will decrease by 25% each year, but can be structured through management. It is expected that the newly issued tokens will initially be distributed in the following areas:
- 57.5% to validators for securing the Quicksilver network and 57.5% to delegates as Staking Rewards to reward delegations.
- - 15% is allocated to an incentive fund to continuously reward new users and liquidity providers.
- - 25% will be distributed periodically to Quicksilver protocol users as a login reward.
- - 2.5% is allocated to a public fund controlled by management and spent on projects that benefit the Quicksilver community.
This distribution is subject to change at the discretion of QCK token holders through a management offer.
Initial allocation of tokens
Quicksilver $QCK’s initial native token offer will be $200 million. These funds will be distributed as follows:
- Community Incentives (aerosols and liquidity) : $102.7 million;
- Fund (development and grants) : $40 million;
- Investors (including potential future investments) : $26.3 million;
- Development team (including DevCompany staff, current and future core team) : $21 million;
- Testnet Incentives : $10 million.
