Tokenomics

Introduction

There are currently two tokens on the ScPrime network; SCP and SPF.

SCP is a utility coin, permissionlessly mined by ASICs with Genesis on 10/31/2018 and used in smart contracting between customers and the Storage Provider network. Supply is infinite, but at 5 years, the inflation schedule is ~1.25% with a coin burning mechanism making supply essentially flat/complete. Coins are burned if a Provider node loses customer data by forfeiting Collateral used to secure their side of storage contracts.

SPF provide stakeholders a mechanism to earn revenue from storage network use across the entire network. The ethos at ScPrime is Evolution, Then Revolution meaning the world’s business data customers are not inclined to full self-service models requiring crypto purchase, custody and the abandonment of well-established protocols/APIs. The XNS product suite developed by the team exists to allow business customers to operate as they already do on products like AWS and Google Cloud, with fiat payments, SLAs, TOS and support. SPF tokens earn a percentage of all file storage contracts. The amount is paid in SCP to a pool of addresses, of which the development corporation is the largest holder.

When self-service, decentralized users become normalized and no longer require mechanisms of traditional clouds, they should be able to purchase/custody SCP for use in data storage. In these cases, SPF provide a revenue stream to the developers who maintain and evolve the network software.

Migration

As of 1/31/2024 the project is working on migration to the Solana blockchain. Tokens will migrate first, followed by smart contracting, consensus and the storage network thru the end of year. Token migration will immediately result in a new coin minted on Solana contracts. In the process, SPF holders send tokens across a Transporter where original outputs get burned, reducing the supply of SPF on the ScPrime blockchain. Newcoin (name/ticker has not yet been announced) is minted in identical quantities on Solana leaving all ownership percentages intact. This results in a new supply, both circulating and total with a preset emission schedule.

The Three Tokens

SCP

Permissionless, decentralized coin mined by anyone who purchases specialized mining computers.

Algorithm: Proof of Work (ASIC only) – Blake(2b)
Total Supply: Unlimited with declining inflation + coin burn (Guide on Total Supply) – currently just over 55M with 1.27% annual inflation not counting burn
Block Reward: 300 declining by .001 coin per block with a 10 SCP floor, occurring in 2024
Block Timing: 10 minute average with a difficulty adjustment algorithm that changes no more than .4% per block

Supply Precision is 24 decimal places or 10^24. A precision change was done early on – Supply Change Guide

In 2022, the project began a discussion with the community on network security and all agree that real blockchain security only comes from a larger L1 ecosystem and a modified consensus mechanism. PoW is acceptable for Bitcoin, but easily provable as insecure for all other coins that gain valuation. For ScPrime, the issue is problematic as the storage data has significant value beyond the value of token assets themselves and is subject to ransom demands.

ScPrime SCP Mining Emission and Total Supply Graphic

The Genesis block was mined on 10/31/2018. In this block was a distribution for orderly operations of the project.

Pre-mine

3,100,000 – distributed on a 1:5 basis to existing holders from the original blockchain (~650,000 addresses)
51,000  – Mining pool maturity cushion: 5 mining pools
200,000  – Project/dev expenses – the only part of the pre-mine taken by the team, it was used for server expenses
300,000 – Nebulous Inc Original blockchain development
This and SPF drop showed us as a supportive/friendly blockchain fork with a clear alternative vision on client software and overall use. Sia management provided an address they no longer had keys to and the coins became unspendable. DYOR. 
1,750,000 – Storage Host Incentives
628,000 – Exchange listing fees
4,523,377 – Network Development fund

ScPrime 2018 Pre-Mine Chart

As of 12/2023, all of the last 3 amounts have been distributed to the ScPrime community in the form of Incentives, Rent and Rebates. All SCP held by the development corporation has been purchased directly on public exchanges or from stakeholders.

Project Fee / Hard Fork

20% thru month 6, declining to 10% over 2 years
After block 105,000, the 10% project fee was sent to an unspendable address (burn) to reduce inflation/supply for the duration of the project. In 2022 when the project had returned most of the Network / Incentives coins to the Storage Provider network, a hard fork was proposed and endorsed by the community to recover burned project fees if they would be used for community network development via Incentives, Rebates and Storage Rent. All of the coins recovered in the fork have since been paid out to the Storage Network Providers.

Inflation Chart

SPF

Earn 15% in fees of the SCP value from each side of a storage contract, effectively 30% of total contracting. Funds are allocated inside the contracts continuously and distributed among the outstanding supply. The tokens become available in wallets when a token transaction such as a send is generated. Fee mounts are determined from both parties to the smart contract, but the actual amount is drawn only from the Renter (storage purchaser) side of the transaction.

SPF have never traded publicly and have never been offered for public sale. The entire initial supply was held by the development corporation. Tokens have been granted to accredited angel investors as part of the early pre-seed capital rounds as bonus coins with no market value. Additionally, bonus tokens have been included in various Storage Provider offerings to incentivize network utility and to grow the network. Supply at the end of 2023 appears in the next pie chart.

200M of the entire SPF supply is timelocked and unavailable. Its primary purpose is to continue revenue generation for the development team after significant storage customers move to fully decentralized processes and no longer pay in fiat. The ability to use the network in this manner is expected to go live in mid 2024, though most customers are likely to expect traditional cloud services while paying with fiat money.

SPF Claims Calculator

Check how much SCP yield is expected from Storage contracts based on input variables. This is separate from earning yield in Liquidity Pools or other Staking processes.

NewCoin on Solana

Migrating SPF to the Solana blockchain will take place over time. In early 2024, an amount of tokens (the Initial Tranche) will cross a bridge called the Transporter. This includes tokens from a variety of community and project participants. When tokens are sent thru the Transporter, they materialize as newly minted Solana based tokens (name/ticker tbd). Originals are burned and no longer available leaving ownership percentages intact

The Initial Tranche includes tokens from SCP, Corp, investors and bonuses given to Storage Providers. Once completed, NewCoin will have its own circulating supply and details will be added to coin information sites like Coinmarketcap and Coingecko. When token minting is validated as working fully, a 30 day clock will start after which an Emission Schedule (ES) is implemented. This sets the number of SPF the Transporter will allow across over a predetermined number of blocks and is built to allow up to 2.62M SPF transports per month limiting the number of Solana-based newcoin to a predictable on-chain supply growth. The emission schedule runs until the entire supply has been converted or the base blockchain is migrated to Solana

The Transporter has other limiters; an individual transaction limit of 20,000 units and a floor of 1000 units. When a user wishes to convert tokens to the Solana format, they send from the ScPrime wallet. If there is enough room in the queue, tokens are immediately burned and new tokens minted. If there is not enough room, the user is prompted to decide whether to wait in the queue for the first opening or to remove the send and wait for a future opportunity.

SCP Yield, Governance and other Features on Newcoin

Initially, the new Solana tokens will not participate in SCP yield claims. SPF on the other side will continue to collect SCP against a total supply of 400M. An expected update to the Solana Program will occur shortly after token launch that will cause newcoins to begin collecting SCP yield.

When the blockchain and contracting is migrated later in 2024, it is expected that newcoin and SPF will play a significant though not total role in consensus generation. It is included in roadmap calls that a desirable consensus mechanism will include a staking component (PoS) as well as a storage proofing component (Proof of Storage/Capacity or other mechanism related to Storage Providers).

When this completes, ScPrime governance capability will be created and holders will play a pivotal role in the direction of the permissionless storage network going forward.

Airdrop

An airdrop on the Solana chain is planned based on users staking SPF in Liquidity Pools (LP) for Automated Market Making (AMM). Full details on amounts and time schedule to be posted here prior to the Transporter launch in January, 2024

History

10,000 ScPrimeFunds (SPF) were initially created and distributed to holders of record at the open source software block 179,000.

At block 59550, a hard fork created an additional 20,000 SPF

At block 109,000, a hard fork changed total emission to 200,000,000 – this was done to make the token easily split so that it could achieve broad distribution

At block 222,800 a hard fork changed total emission to 400,000,000 – this was done to provide more tokens for the storage provider network and split the emission into 2 separate formats; SPF-A and SPF-B with B needing to be in wallets tied to storage contracts.