Core V1
Last updated
Last updated
The purpose of the first iteration of Possum Core is to obtain real world insights with our novel capital allocation & distribution system.
Core V1 in a nutshell:
stake PSM to earn Core Fragments (CF)
Choose a stake commitment period - a longer duration increases the CF accrual rate
distribute CF to whitelisted addresses to earn PSM rewards
The function of Possum Core V1 is to hand over the decision about capital distribution of a 300M PSM budget to PSM stakers and to learn from observations and user feedback.
A full deep dive about our thoughts on governance and the first iteration of Possum Core can be found in our blog article.
Users can stake their PSM into the Possum Core contract. Upon staking, users must specify a commitment period which can be anything from 0 seconds to 1 year. The longer the commitment period, the higher the Core Fragments (CF) accrual rate.
The CF accrual rate starts at 12% APR and tops out at 72% APR for a 1 year commitment.
Users can withdraw their stake at any time, even during the commitment period. However, withdrawing a stake during the commitment period will forfeit accumulated rewards in proportion to the withdrawal.
For example:
Bob stakes 1000 PSM with 1 year commitment, generating CF at 72% APR
Bob accumulates 200 PSM in rewards over some time
After 5 months, Bob withdraws 100 PSM
Bob loses 20 PSM in rewards (100 / 1000 * 200)
A user-friendly feature of the Possum Core is that users can remain staked as long as they want and continue to accrue CF at their current accrual rate - even after their commitment period has ended. This is opposed to veStaking systems where users constantly need to prolong their hard-lock to not lose earnig power.
For example, if Bob continues to stake his 1000 PSM after the 1 year has passed, he continues to generate CF at 72% APR as long as he wants. Core V1 comes preloaded with a fixed amount of PSM to avoid long term economic strugles with such a generous staking reward. Once this amount has been distributed or claimed, there is no reason to remain staked in Core V1. (Core V2 will be ready by that time)
Stakers can distribute their Core Fragments to whitelisted addresses. For every 1 CF distributed, the staker accrues 1 PSM in rewards. Every 1 CF distributed to an address commands the Possum Core to send 1 PSM to that address.
In short: Distribute 1 CF -> staker receives 1 PSM & Core sends 1 PSM to destination
The accrual amount of CF is based on the user's CF accrual rate (APR) and their earning balance, which is the sum of staked PSM and earned rewards. This means, distributing CF frequently allows to compound the rewards and increase the staker's decision power over those who are less involved. This mechanism incentivizes recurring activity and being engaged with the project over simple bag holding. For example, a staking APR of 72% can be compounded into >100% APY if CF are distributed daily or weekly.
