Today the Swingby pre-staking rewards have been reduced from 52% APR (67% compounded) down to 30% (34.8% compounded).
If you’ve read the Swingby Whitepaper or checked out our website, [you should ;)] — You will already know that the SWINGBY token is required to run a Metanode on the Skybridge network. These nodes earn a large amount of money since 2/3rds of all network fees are given back to Metanode operators (the rest goes to liquidity providers).
The aim of the pre-staking program was always to help distribute the Swingby token to loyal holders, who will eventually help to secure the Skybridge network by operating their Metanodes. Now that the ability to run a Metanode is available, we want to try to encourage existing pre-stakers to start running their own Metanodes.
We have always publicly stated that for every bridge that we launch, we will cut the pre-staking APR in half, and now that the BTC to Ethereum bridge is live we want you all to help us secure the network.
To help justify the hardware costs of running a Metanode, in the early stages of the launch, Metanode operators will continue receiving 52% APR. As the BTC to Ethereum bridge processes more volume and the rewards generated from the network alone are enough to justify these costs, then the APR will be reduced for Metanode operators also.
Why have you reduced the pre-staking?
Now that we have successfully launched our Chaos-MainNet we want to try to encourage pre-stakers to begin running their own Metanodes.
Will you drop it again in the future?
Yes, but not until the end of Q1 2021 when we launch our next bridge. We will cut the pre-staking in half.
When will this become active?
This is already active. The next pre-staking payout on the 31st of January at 00:00 UTC will be calculated using 30% APR.
I run a Metanode, how will I receive my 52% APR?
Don’t worry, our pre-staking system will track the time-locked tokens bonded to your Metanode. If your Metanode is in the top 50 most bonded nodes, then you will earn 52%, otherwise, you will receive the standard 30%. Your rewards will be sent to the same address that is used to bond your tokens.
How will this affect the token?
There are 3 things to consider here:
- The reduction of pre-staking APR means that there will be less consistent sell pressure on the token.
- By incentivizing community members to migrate from pre-staking to Metanode operation, significant buying pressure may enter the market since 150k Swingby tokens (minimum) are required to run a Metanode.
- Token holders that held the token specifically for the high APR may be likely to sell if they are not interested in running a Metanode to continue earning 52% APR.
Will Staking providers such as Bitmax also reduce the APR?
Yes, Bitmax will reduce their staking APR to 28%. To receive the full 30% APR please use our self custody staking portal.