Migrating SCP to DeFi on Solana

SCP migration can lead to needed coin liquidity on DeFi exchanges and is crucial for project security

Important Update: 4/6/2024

To facilitate the initiative described in this post, we need a community vote on the aspect of limiting the migration of SCP to Solana. The two proposals at the bottom are the question and all legitimate Storage Providers are eligible to vote on this proposal. Storage Providers are the community at large and will be the mechanism for governance issues until we transition to a different consensus sometime in 2025.

To vote, you will need to download a new version of the Web Wallet and and open the wallet with the seed associated with your Xa-Miner, XM Full license or Basic installation. Then, locate the Vote page under the My Wallet tab and cast your vote. If you have more than one Provider, you may vote up to the number you have but you will need to open each seed separately in the Web Wallet. In the future, the Web Wallet will be pushed into the miners directly negating the need for external seed input.

Migrating SCP

ScPrime is about to take the next step toward full migration to Solana with a proposal and voting to Transport the storage contracting coin for listing on DEX.

SCP tokenomics and coin supply

SCP is a permissionlessly mined coin with a genesis block in 2018. It is a Proof of Work blockchain with ASIC friendly algorithm. SCP coins are emitted as a reward for miners that validate hashes and secure the blockchain. The supply curve is deflationary and after five years, inflation is nearly flat. The project has had mixed success with centralized exchanges, mainly due to a lack of funding for market marking and the increasing exchange listing fees. SCP started on Crypto Bridge before it failed, then listed on Probit and Whitebit, before delisting due to low trading volume. Southxchange was a long running partner until the site shuttered in early 2024. Today, SCP is listed one a single centralized exchange, Trade Ogre.

Liquidity

The biggest question securing blockchains come down to daily profitability and overcoming costs like electricity. Miners must be able to sell enough coins to cover ongoing costs, pay for the capital expense of hardware and turn a profit. Some miners “spec-mine” certain coins, they are willing to forego costs as another way to accumulate tokens.

Unfortunately, SCP is fairly illiquid today and mining hashrate is at all time lows. To address, the dev team has roadmapped and is in the process of migrating from our own L1 blockchain to an environment better suited to protect our storage network and customers. SPF tokens are now migrating as the new D2X token and next up is SCP to provide the liquidity of decentralized exchanges on the Solana network. Our expectation is that better access to the coins and mechanisms to earn yield while holding it will lead to more interest and price discovery.

Proposals

SCP is key to the storage network and core economics as the contracting coin used to purchase and collateralize data capacity on the network. The community should decide on the process to migrate the coins as stakeholders that mined and purchased the assets along the way. There are no plans to create a custodial bridge for back and forth asset movement and development of a decentralized bridge is too much development burden considering we plan to migrate the whole network later this year. The Transporter one-way bridge will burn SCP on this network dropping the supply of coins, while minting new versions on the Solana contract. The Solana token will not immediately participate in storage contracting, but will gain the ability later in 2024.

All proposals include a ceiling of no more than 50% of the outstanding supply will be able to migrate until we transition the whole network. This represents an enormous coin burn on the contracting side which could have material impact on coin availability for storage. The following represent 3 strategies to vote on. Community will be given a link soon and only active Storage Providers will be able to cast a vote in this process as the true network stewards.

Supply Curve

Assumptions

No more than 50% of the coin supply will migrate.

A one-way bridge with coins burned and never returning to the ScPrime blockchain.

We expect to maintain a listing on CEX

We expect to seek additional CEX listings on the migrated coin after enough daily volume is achieved.

Proposal 1 – All-in

The first proposal is recommended by the development team. The strategy is no limitations, either in transaction size other than a 100 coin minimum, or total Transportable amounts. Up to 50% of the supply will be Transportable immediately.

The benefit is a lower burden of coding work, an ability to create strong initial liquidity and free-market economics. Nobody can predict how this will impact or affect price here or on the other side. The potential downside could be significant coin selling, lowering holder value.

Proposal 2 – Emission Schedule

The second proposal limits the number of coins initially Transportable and implements an inflationary supply curve until 50% are migrated, opposite of how the coin was initially mined. Most coins will not Transport until after a significant amount of time. The benefits include limiting amounts that large holders can attempt to sell into fragile early markets, while providing predictability to how many coins will be in existence on Solana. The potential downside could be the larger crypto community not accepting such a managed process as a heavy thumb on the scale of tokenomics as well as perhaps not providing enough coins for solid liquidity. This proposal requires additional coding work.

Voting

Watch this page or our Discord for information on how and when voting will begin. You will need to download the latest Web Wallet to vote and have an active Storage Provider to be eligible.