The StarkNet Token (STRK) is now on the Ethereum Mainnet! STRK will be used as a staking token to participate in STARKNET’s consensus mechanism, as a management token, and for paying transaction fees.
The tokens held by the StockWare shareholders, employees and independent partner software developers will be locked for a four-year period and will be gradually released after one year.
Token Distribution Process
Tokens that are locked can be used for voting and staking, but cannot be used for trade or transfer. Some of the tokens are locked with smart contracts on Ethereum, while some are locked by custodians.
Additionally, 50.1% of the available StarkNet tokens were allocated to the StarkNet Foundation for the project to achieve its goal. These tokens are not locked. However, the Foundation will need time to allocate these tokens further and at the same time to share its plans.
Why Tokens are Locked?
Locking the tokens for the aforementioned period ensures that they are compatible with STARKNET’s long-term incentives, while at the same time protecting them from speculation until they go into a widespread use phase.
Voting
The Foundation is responsible for facilitating governance and formulating voting mechanisms. The StarkNet token is designed to allow both direct voting and a range of delegation mechanism.
For the L1 Vote
The ERC-20 positioning now also includes the optional use of Coupound’s authorization module. In addition, this module is widely used for on-chain voting.
Non-L1 Voting
Alternatives to L1 on-chain voting with Compound’s delegation model include StarkNet-based on-chain voting systems as well as off-chain voting. These alternatives, which significantly reduce gas consumption for L1 transfers, do not require explicit support from the currently used ERC-20 code and are therefore natively supported.
Staking
Sequencers are randomly selected for StarkNet’s permissionless and censorship-resistant operation. The probability that a node will be selected to sort and recommend a block is proportional to the number of StarkNet tokens staked by the node. Additionally, it is explained by the governance proposal to use StarkNet tokens (rather than Ethereum or Bitcoin). The exact details of staking, sorting and block creation on STARKNET continue to be discussed by the community and have not yet been finalized.
About Starknet
StarkWare develops STARK-based solutions for the blockchain industry. Its products facilitate secure, reliable and scalable blockchain applications.
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