Starknet token design:-
The requirements of supporting a network made up of Users, Operators (who supply computing power for transaction sequencing, STARK proof generation, and long-term storage), and Developers who create applications and infrastructure software have an impact on the design of the Starknet Token. These factors must be taken into account when determining the fee schedule and token minting procedures.
The token allocation mechanism, which takes its cues from well-established methods in other blockchain systems, will give automation precedence over substantial human intervention. It seeks to preserve transparency, robustness against speculative manipulation, and simplicity for simple analysis. The allocation strategy is based on providing a good user experience, and operators are essential to maintaining Starknet’s continuous liveness and optimal protocol performance. In order to comply with these principles, the mechanism makes use of new minting and transaction fees.
In order to maintain Starknet’s continuous operation and satisfy users’ performance expectations, operators are essential. In the meantime, developers are in charge of creating and maintaining the network security software that Operators use, in addition to creating applications that expand users’ access to the network. Core Developers and Smart Contract Developers will then each receive a portion of the fees and new minting.
Starknet’s protocol evaluates smart contracts’ value on its own, taking into account user-paid L1 and L2 fees. It gives smart contract developers an automatic share of fees and newly created tokens. Contracts with higher value—as determined by the fees they draw—will be allotted a larger portion of the tokens for this use.
There is no automated way for the Starknet protocol to evaluate the work that Core Developers—the people who write the code for provers, sequencers, full nodes, and other components—do. As a result, human judgement is needed to allocate tokens to Core Developers and other contributors whose contributions cannot be measured. To guarantee conformity with the decentralisation goal, a model will be created.
Ten (10B) billion “Starknet Tokens” have been created off-chain by StarkWare. It is important to understand that these tokens do not grant claims or participation rights in StarkWare. The protocol’s issuance of new tokens is subject to an increase in the circulating supply, which could lead to a dynamic circulating supply as opposed to a fixed one, based on a schedule decided by the community.
Here is the token distribution:
– StarkWare Investors will receive 17% of this.
– 32.9% set aside for Core Contributors, which includes partners in software development at Starknet, StarkWare staff, and consultants.
– 50.1% given to the Foundation by StarkWare, broken down as follows:
– 9% is set aside for Community Provisions, which are meant for people who helped build Starknet, especially those who used StarkEx L2 systems prior to June 1, 2022. Based on authenticated prior work, allocation is made.
The following is the breakdown of distribution:
– Rebates to the Community (12%): For those switching from Ethereum, rebates in Starknet Tokens will be given to help with onboarding expenses. Rebates are limited to transactions announced after the introduction of the rebate mechanism in order to prevent misuse.
– Grants (12%): Allotted for studies and research related to the creation, testing, implementation, and upkeep of the Starknet protocol.
Asset Allocation (10%): Set aside to support ecosystem initiatives that are in line with the Foundation’s goals, as explained in a previous post.
– Donations(2%): Set aside for contributions to prestigious establishments and groups (universities, non-governmental organisations), as decided by the Foundation and Starknet Token holders.
Unallocated (8.1%): Allotted to the Foundation’s unallocated treasury with the goal of enhancing community support for Starknet users. The way it is used will be decided by the community.
In order to guarantee that the long-term dedication of Core Contributors and Investors is in line with the interests of the Starknet community, a decentralised ecosystem standard procedure will be implemented. Every token reserved for investors and core contributors will have a 4-year lock-up period with a 1-year cliff and a linear release schedule.
