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EQO

EQONEX Origin explainer: How to earn EQO?

March 19, 2021
Unlike most token offerings, EQONEX Origin (EQO) is not being offered for sale to raise capital. Instead, EQO can only be earned by trading on or ‘staking’ on the exchange, with a minority portion of the daily allocation sent to the EQONEX treasury.

EQO is not an Initial Coin Offering (ICO), nor is it an Initial Exchange Offering (IEO). This means that no funds are being raised through the launch of this token. The token is issued entirely through a series of Reward Blocks for engagement on the platform. 

10% of each Reward Block is allocated to the EQONEX treasury for use to grow the platform further. The remaining 90% is the Reward Batch and is allocated to users on the platform via trading and staking. 

The Reward Batch ratio of trading to staking shifts at each halving, but starts at 85:15, with 85% of the Reward Batch going to fee paying “Price takers” on the platform based on their percentage of volume that day, and 15% goes to clients holding or ‘staking’ the token. At each halving, the ratio shifts by 10% away from trading towards staking. By the final halving, the starting ratio is effectively reversed, leaving the final Epoch at an 85:15 ratio for staking to trading, respectively. The reason that the ratio shifts towards staking is to keep the daily yield compelling for staking despite the overall underlying stock growth. 

The trading portion of the Reward Batch is allocated to clients based on their percentage participation in specifically price taking activity that incurs fees on the platform. A price taker is a client that is buying or selling on the EQONEX platform at the best price at the time. A trade is always made up of two sides, one is the price maker, the other is the price taker. A price maker is the “sitting” bid or offer, and the taker is the aggressor of that price. In practice, this means that if a client is to be considered a price taker, they would have to perform either a Market Buy or a Market Sell order, or by placing a Limit Buy or Limit Sell order which effectively does the same thing by being either at or above the best offer if a limit buy order, or at or below the best bid if a limit sell order. A taker trade is effectively any trade that aggresses the orderbook. 

If a client buys or sells US$10,000 of Bitcoin on EQONEX (as a taker) and $1,000,000 of fee-paying volume trades that day, the client will get 1% (10,000/1,000,000) of the trading portion of the Reward Batch for that day. The Daily Reward Block for the first 90 Blocks is 117,124 EQO. In this case: 117,124 x 90% = Reward Batch = 105,411, of which 85% is for trading rewards = 105,411 x 85% = 89,599, so this client will receive 89,599 x 1% = 895.99 EQO for his trading that day. If the client holds these tokens for the entire Issuance Period, the client will receive a new staking reward every day for all the remaining Reward blocks. 

Staking EQO on the platform means simply holding onto it on EQONEX. Every day, the staking portion of the Reward Batch is allocated based on the overall ownership of EQO on the platform.  If a client doesn’t sell the EQO which they have accrued and hold it in his or her wallet on EQONEX, he or she will receive more EQO daily for the remaining Reward Blocks. For example, if during any day within Epoch 1 there is a total of 2,000,000 EQO held on the platform, and a user holds 20,000 EQO, they will be eligible for 1% of all tokens awarded to staking. The Daily Reward Block during this period is 117,124 EQO. After taking up the Treasury Allocation, the Reward Batch is 105,411EQO. 15% of the Reward Batch is allocated to staking rewards, which is 105,411 x 15% = 15,811.76 EQO. Therefore, this client who is eligible for 1% of all tokens allocated to staking will be eligible for 1% of this allocation, which is 15,811.76 x 1% = 158.11 EQO on that particular day. 

A table indicating the number of tokens to be distributed on any given date will be made available on the EQO website www.eqonex.com/eqotoken. A trading day is between 00:00:00 UTC and 23:59:59 UTC. 

Special reward upon launch  

On the “Full Launch” of the EQO token, which is the first day of the token distribution (8th April 2021), EQONEX will release 11 Reward Blocks, with the first 10 rewarding fee-paying client’s price taking volumes between “Initial Launch”, which is the date of the whitepaper launch (15th March 2021) and the Full Launch. This means that the first 10 EQO Reward Batches are awarded purely based on trading as a Price Taker (defined above), so 100% of the Reward Batch goes to trading over the period of 16th March to 7th April. This means that a full 117,124 EQO x 90% x 10 = 1,054,116 EQO out of the hard supply limit (21mln) will be allocated for trading over that 23 day period. The remaining 1 out of the 11 Reward Blocks will be allocated based on that first day’s trading and staking activity. Traders who have been active in that 23 day period will exclusively share the staking reward for that first day. 

To learn more about earning extra EQO, read the whitepaper here 

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EQONEX Origin explainer: How does EQO reduce fees?

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Holding EQO on EQONEX entitles clients to discounts on their trading fees. These discounts will be implemented through an uplift to the client’s fee tiers based on how many EQO are held by the client.