The Benefits of Participating in the Fusotao Protocol

63% of $TAO tokens will be allocated to community members participating in the protocol.

hat is, community traders, blockchain validators and $TAO staking participants. They are the main contributors to ensure the stable operation of the Fusotao Protocol and realize the zero-cost, high-speed and safe transaction. The three participants will get $TAO rewards through PoT, PoV and PoS.

1. Trading rewards: Proof-of-Trading (PoT)

Fusotao protocol is a set of matching and verification protocols. “execute off-chain, verify on-chain” paradigm is the core of the Fusotao Protocol. Through on-chain authorization and off-chain order-book matching, users can complete transactions and obtain transaction proof without assets custody. The whole process is based on automate trust rather than human trust. The user’s assets will not be changed until the matched transaction is proved successful on-chain.

The trading itself is the core of the whole system. Fusotao protocol introduces the Proof-of-Trading to motivate transactions to obtain TAO rewards. When users trade on DEXs powered by the Fusotao Protocol, they will get TAO tokens according to the trading volume in one era(about 24hrs ). 48 million TAO tokens, accounting for 48% of total supply, are used for PoT rewards. After the launch of the Fusotao mainnet, it will be unlocked at an unlocking rate of 9.6% every year. 26,301 TAO tokens will be distributed to traders every era as PoT rewards.

The detailed reward rules are as follows. Assuming that the total trading volume of all DEXs powered by Fusotao Protocol is equivalent to $10000 in one particular era, and the trading volume of a user is $50 in that era. This user can get

($50 / $10000) * 26,301 TAO = 131.5 TAO as PoT reward in that era.

2. Validator Rewards: Proof-of-Validator (PoV)

It is a common practice for blockchain projects that network nodes with packaging rights receive token incentives, which ensures the correct operation of the network. Verification nodes of the Fusotao Protocol is provided by the Octopus Network (OCT). Community users can obtain TAO rewards by becoming the verification node or staking OCT to verification nodes in the octopus network.

3. $TAO Staking Rewards: Proof-of-Staking (PoS)

In order to incentive the long-term holders of TAO tokens, the Fusotao Protocol will also support TAO token staking after the mainnet is launched. Stacking participants and reward distribution are completed automatically through the protocol to avoid centralization risk. Staking reward, accounting for 7.5% of the total token supply, will be unlocked for 5 years, with an annual unlocking rate of 1.5%.

Staking participants need to lock TAO to the staking protocol. The protocol will automatically calculate stacking rewards according to the locked proportion, and the user can claim staked tokens and rewards after the staking period. Users can not withdraw their staking token during each stack period. 1.5 million TAO tokens as PoS rewards are distributed to stacking users every year.

Suppose during one event, the system sends N TAO to PoS participants daily. The amount of N is proportionate to the trading volume, number of users and liquidity of Fusotao. Detailed rules will be published later. For example, if a user’s effective lock-up amount is 10,000 TAO on that day, and the total lock-up amount is 1,000,000 TAO, the user is expected to receive

(10,000 TAO / 1,000,000 TAO) * N TAO = 0.01N TAO

4. Claim as a Matcher

Fusotao is a completely permissionless network where any $TAO holder can stake a certain number of tokens to build a DEX on Fusotao and earn transaction fees. No need to maintain assets anymore, just prove any modifications that are made.

5. Staking for DEX to Share Transaction Fee

Community users can directly share transaction fees through staking $TAO Tokens for the DEXs backed by Fusotao Protocol.

Suppose a DEX backed by Fusotao Protocol has a daily transaction fees income of $10 million. The total number of $TAO tokens staked for this DEX is 1 million $TAO, of which you staked 10,000 $TAO tokens for this DEX. Then you will share transaction fees on the day as follows:

$10,000,000 * (10,000 TAO / 1,000,000 TAO) = $100,000

$TAO is the native utility token of the Fusotao Protocol. It is a link that incentives developers and community members to participate in Fusotao ecosystem. More than 63% of $TAO tokens will be distributed to the community. Community members can get $TAO rewards by participating in trading, community governance, verification nodes, and $TAO staking, or directly share transaction fees through staking tokens for the DEXs backed by Fusotao Protocol.