Welcome back everyone, today, in the second part of BTC-20, we will discuss the 2 key parts of this project.
If you missed the first part, you can find it here!
We will do so by analyzing the Whitepaper found directly on the site here
Although the site is quite comprehensive, the Whitepaper, is not as accurate; that is not to say that we can say that the project is not reliable.
Let's start with the first part, Tokenomics
As I wrote in the previous post, this is a mirroring of BTC; therefore, everything is a function of that coin.
In 2011, the mined supply of Bitcoin was 6,050,000, with a unit value of about $1.
From this data, the tokenomics of BTC20 was developed!
The presale, in fact, plans to have a softcap at 3,000,000 and a hardcap at 6,050,000; all tokens that are not sold will be locked into a smart-contract to start the staking process.
The staking of tokens is incentivized as it gives the opportunity to earn in proportion to the tokens that are locked.
As BTC20 matures, its circulating offering will expand, heralding a more decentralized and engaged community.
The gradual unlocking of participation rewards will provide a lasting incentive for long-term participation, reinforcing the commitment and dedication of community members. The economics of BTC20 tokens extend beyond the wagering rewards program.
Potential future use cases include strategic partnerships, utilities within decentralized applications, and governance rights within the BTC20 ecosystem.
These additional use cases aim to provide greater value and utility to token holders, further strengthening the robustness of the token economy.
Staking is the beating heart of this project.
The advertising leverage of this project is the fact that block validation is done through PoS (Proof of Stake) and not PoW (Proof of Work) thus low energy.
The rewards follow along the lines of BTC, so when a BTC block is validated, the equal rewards are in BTC20.
Let me explain further.
In 2011, the first Halving (halving of rewards that happens every 4 years) had not yet happened so the reward for each validated BTC block was equal to 50 BTC.
Similarly, the reward to be divided in proportion to the tokens locked in staking corresponds to 50 BTC20.
This means that every 10 minutes or so, the reward pool increases by 50 tokens.
The process will last for 4 years, then, in the same manner as Bitcoin, there will be the first Halving of BTC20 and the rewards will halve to 25 tokens, and so on until the completion of the process which should end within 120 with the creation of all 21,000,000 BTC20.
The project is still in its infancy, in fact in 2025, more integrations with various dApps are planned, and the token will become governance to be able to make decisions within the community
If you remember well, in the introductory post I talked about pretty high rewards, well in the whitepaper they are not mentioned let alone explained, so, for the time being, I would invest a few hundred €, just for the purpose of basket diversification and to see if it can have a future in the crypto community.
See you the next time, with a new token!
