The Ink Finance Staking Engine — Empowering Protocols, Asset Managers and Token Holders.
A novel approach to customizability without code for protocols, asset borrowers and entities that exist on-chain
The Ink Finance Staking Engine has officially launched on mainnet, heralding a transformative advancement in stake-based governance mechanisms. This feature empowers DAOs to implement a “stake to govern” policy, compelling token holders to “have skin in the game” to participate in governance activities. This strategy not only promotes active engagement in governance but also provides a robust defense against Sybil attacks, preventing the misuse of the same tokens across multiple wallets.
The introduction of the Staking Engine completes Ink Finance’s comprehensive governance framework, which now encompasses no-token, token staking, and hybrid modes. This diverse suite of options grants DAO creators the flexibility to customize governance structures to suit their project’s specific requirements and developmental stages, thereby ensuring resilient and adaptive governance solutions.
Coinciding with the release of the $QUILL IDO for Ink Finance on mainnet, the Staking Engine underscores our dedication to delivering SaaS-grade features that empower DAO creators, protocols, and participants.
In addition, the Staking Engine module offers protocols a customizable and seamless solution for staking management. It features an integrated yield-paying mechanism for stakers, obviating the need for protocols to code their own staking contracts. This innovation not only simplifies the staking process for DAO creators but also enhances the potential for rewarding community participation through yield distribution.
An examination of the sophisticated mechanisms underlying a token staking DAO reveals the transformative potential of this innovation in decentralized governance and stakeholder incentivization through yield generation.
Creating a Staking Engine-Powered DAO to Manage A Protocol or Treasury
To establish a token staking DAO, creators have the flexibility to either initiate a new staking emission pool or utilize an existing one. For newly created pools, they can specify the total reward emission in tokens and define the corresponding release timeframe. Our smart contract efficiently manages the distribution of rewards to participants, executing daily distributions based on the amount staked and other predefined parameters.
Creators of a DAO or any web3 protocol must delineate the pledge requirements for nominated committee managers. Only members who meet these stipulations are eligible for nomination to committee manager roles. The DAO or protocol can nominate individuals who fulfill these staking prerequisites, ensuring that nominated managers have a significant stake, thereby demonstrating their commitment to perform their designated tasks diligently. This framework assures voters that delegated managers are adequately vested in the success and governance of the DAO or web3 protocol.
This sophisticated staking mechanism not only strengthens the integrity of DAOs but also extends its utility to various web3 protocols, fostering a more robust and engaged governance ecosystem.
Staking Entitlements and Rewards
Participating in token staking provides holders not only the opportunity to reap rewards, which they can conveniently claim and have deposited directly into their accounts, but also extends the privilege of exercising voting rights within the ecosystem. These voting privileges are intricately tied to the quantity of tokens staked, underscoring the significant influence staking activity imparts on governance decisions.
Furthermore, staking carries a deeper commitment beyond mere voting participation. When stakeholders cast their votes on proposed initiatives, they commit specific staked tokens to be temporarily locked in place until the conclusion of the proposal. This commitment ensures a fair and resolute voting process, where participants demonstrate unwavering dedication to the collective decision-making process. Throughout this period, the locked tokens remain committed, maintaining the integrity and credibility of the governance framework.
Staking Rights and Committee Nominations
Within the framework of Ink Finance, token holders are presented with a strategic avenue to compete for pivotal Committee Manager roles by leveraging a defined quantity of tokens during the DAO’s genesis. This act of commitment entails the permanent locking of tokens, symbolizing a profound dedication to the DAO’s governance ethos. Upon signing of the committee formation proposal, the smart contract seamlessly enforces the irreversible lock on these staked tokens, concurrently facilitating the accrual of emission rewards for appointed Committee Managers.
Nevertheless, in scenarios where the committee formation proposal fails to attain requisite support during the voting process or where stakers are relieved of their committee duties, the contractual mechanism permits the release of their Manager roles. This pivotal feature empowers stakeholders with the flexibility to strategically unlock their staked tokens, thereby optimizing their participation strategy and fostering a dynamic ecosystem within Ink Finance.
Our unique framework can be applied and utilized by other protocols and DAOs alike who want a unique system in place to govern and distribute rewards to token holders, without the need to code their own token staking engine or governance system, all while maintaining integrity and transparency through a middle ground platform.
The Benefits of the Staking Engine Mechanism
- Embracing Shareholder-like Responsibility: Staking mandates participants in governance to lock a designated quantity of tokens as evidence of ownership, highlighting both an economic commitment emblematic of responsibility and a strategic measure fortifying the DAO against Sybil attacks and other nefarious governance loophole activities.
- Fostering Token Holding and Long-Term Investments: By leveraging staking, token holders have the opportunity to secure their tokens in smart contracts, thereby participating in their DAO’s consensus-building process. In return, participants are eligible to receive rewards — entirely customizable by the web3 protocol or DAO that administrates the staking engine. This incentivized framework not only promotes long-term token holding but also mitigates short-term speculative behavior, establishing a robust support foundation for the project’s enduring success.
- Cultivating a Devoted Community: Staking incentivizes active engagement and contributions from token holders, catalyzing the formation and evolution of a cohesive community. Through staking, holders forge deeper connections with the project, fostering community cohesion, aligning interests, and fortifying long-term support for the project’s growth trajectory.
At Ink Finance, we embody the core tenets of transparency, flexibility, rigor, competence, and integrity. Governance and management serve as the linchpins propelling our mission forward. The introduction of the Staking Engine represents a pivotal evolution of our product, underpinning our commitment to innovation and empowerment within the web3 financial landscape.
About Ink Finance
Ink Finance is the only DeFi engine for DAOs, web3 protocols & systematic on-chain financial management. Ink Finance enables organizations to build effective operation structures and perform best-practice financial management on-chain, focusing on transparency, flexibility, and credit-based DeFi.
Leveraging unmatched customizability, Ink Finance’s platform offers versatile governance modules, integrated risk control, compliance, & integrated workflows.
Ink Finance is led by a perfect blend of veterans in traditional and corporate finance, FinTech, and blockchain.
Finance is built on credit, and credit comes from competence.
