Communication is the foundation of the Internet. Social media, news, shopping, and educational platforms are all underpinned by the ability to communicate across the world, at any time, with anyone. We form relationships, we learn, we grow, and we share our lives and our secrets online – and up until now, we’ve done it by selling our identities to the most powerful companies in the world.
The xx network is a revolution in the way we build and use the communications platforms that make the Internet so ubiquitous in our daily lives. The xx network provides private communications infrastructure that isn’t owned by a corporation, individual, or government. On top of that, the xx network can’t scoop up your data or your identity, and it can’t be censored – nor be discovered – even by the most determined actors. Ensured by cryptography, the xx network is owned and operated by its users, meaning you can run the servers and make the decisions.
The xx coin represents your voice in the network. It’s used to vote, exchange value, and incentivize you to run a server or node, and it gives uncensorable access to the most private decentralized communications network in the world. The full rundown on the xx network’s tokenomics can be found here, and we’ve put together a high-level overview of the xx coin below for those of you who are interested in helping build a truly protected digital society.
What is xx coin?
xx coin is the native digital currency of the xx network. This secure digital currency can be traded among individuals and institutions and all xx coin wallets are embedded with quantum-secure keys which will protect your assets in the event of a quantum computing breakthrough.
On top of that, xx coin plays an essential role in incentivizing network participation and decentralized governance through xx network’s multifaceted, tokenized reward structure.
xx Governance & Rewards
The xx chain uses a Nominated Proof of Stake (NPoS) protocol to secure the network economically. The network’s decentralized governance mechanisms allow every xx coin holder to propose, second, and vote in the referendums that shape the network. These referendums may modify the code of the network, add new features, change economic structures, and control just about every aspect of the platform.
More specifically, the xx network will use nominated staking to incentivize all coin holders to participate in node selection, operation, bonding, and governance. There are four main ways to contribute to the xx network and start earning xx coins:
- Run an active node: xx coin holders can become an xx network node operator and earn xx coins in exchange for helping secure the network. Prospective validators must stake a minimum of 1,000 xx coins and attract nominations and stakes from the community to be elected. Once elected, every validator is equal, meaning their xx coin staking rewards are not proportional to the validator’s stake, but rather determined by a point-based system that measures each validator’s relative blockchain performance (uptime, block production, etc.). Today, it takes over 100k xx in nominations to become a node on the xx network blockchain.
- Nominate an active node: xx network users who do not want to become validators can stake their coins and nominate validators in order to vote on governance proposals and nominate nodes in the network. These Nominators earn interest on the tokens they have staked on active nodes every “era” according to an interest rate curve and the specific commission and performance of the node.
- Build an xx app: The xx Foundation has launched a special grant initiative to jumpstart the development and deployment of privacy preserving dApps using the xxDK. The program will award individual grants of up to 1,000,000 xx coins for each successful submission, from an initial pool of 10,000,000 xx coins, and the Elixxir team will also be involved as advisors for every grant project accepted at this stage.
- Grow the xx ecosystem: the xx network’s treasury was created to fund bounties and rewards for ongoing development of the xx ecosystem through activities proposed by the council, the tech committee, or the community at large. Join the xx Discord and Telegram to learn more about new community initiatives and contribute new ideas for how to grow the xx ecosystem.
xx nodes are essential to the security and core operations of the xx network, and node rewards are composed of a share of the fees paid into the network plus an inflationary reward of newly minted xx coins. That said, we understand that running a full node requires some expertise, time, and money to acquire and maintain the requisite computing hardware and minimum bond amount. That’s why we’ve incorporated node nominations and other reward mechanisms – so every active xx user has the ability to participate in xx network’s governance and development and earn xx coins for their contributions.
xx coin Ecosystem Usage
The xx network was founded on the belief that no matter where you are in the world, you should be able to communicate and transact privately without worrying about whether your digital footprint can be viewed or compromised by any external party. That’s why our open-source technology is designed to enable two primary functions: private communications and secure payments, both of which are planned to rely on a mix of free and paid “postage,” the unit that quantifies the amount of computing power and bandwidth required to transmit data privately across the xx network.
- Private communications: Usage of the xx network’s private communication layer is designed to be accessible to anyone with a suitable mobile phone. The system is currently designed to be free to use for xx user accounts who stake or burn a small number of xx coins in order to acquire free postage.
This allotted free postage is sufficient for most users’ day-to-day messaging needs. However, organizations and independent developers who want to deploy and operate dApps and smart contracts on the xx network will need to pay for additional bandwidth using xx coins. In the future, we will roll out additional mechanisms for acquiring and using free postage in order to benefit regular xx users, but the demand for xx coin will continue to grow as more privacy-minded businesses and builders use the xx network to communicate en masse.
- Secure payments: Every xx coin on the network is held in an account or wallet that is seeded with the strongest type of quantum-secure cryptography known. This ensures that, unlike traditional banking or other cryptocurrencies, not only are your individual coins protected from the rapid development of quantum computers, but just as importantly the infrastructure securing your coins is protected from systemic risk.
While xx network messaging is currently free to use, the xx community may adopt a postage system in which all xx coin holders would have rate-limited access to the network depending on their needs. As envisioned, all xx accounts would automatically accrue free postage gradually over time to ensure that xx network remains universally accessible. Advanced messaging functionality, enterprise adoption, and integration with other blockchains or dApps will require additional postage gained by purchasing xx coins. The xx network’s unique network architecture is structured in a way that enables every new node to provide additional transaction processing power and relay capacity. This means that as the number of xx nodes increases, both security and performance improve. These scaling characteristics thereby enable a virtuous cycle of growth, in which validator revenue increases as network utilization increases, which then allows the network to onboard and support additional nodes and further increase capacity.
xx coin Distribution
One of the xx network’s goals is to broadly distribute coin ownership in order to enhance network security and establish egalitarian incentives across the xx network’s entire privacy-enhancing ecosystem.
1 billion xx coins were created during genesis following the xx network’s mainnet launch on November 16, 2021. Less than 5% of these were immediately put into circulation at genesis, and token distribution was allocated according to the below distribution.
xx coin Distribution
|BetaNet Rewards||5%||Coins earned have a 1-year lockup from the month they are earned||Allocated to BetaNet node operators and community airdrops. All remaining xx coins will be used to pay nodes running the canary test network.|
|Staking Rewards||30%||No lockup or vest but are subject to a 28-day unbonding period when unstaked||Algorithmically distributed to stakers in the xx network to incentivize users to stake in the MainNet.|
|Coin Sales||30%||1-year lockup for coins purchased during BetaNet||Allocated for public and private sales. Roughly 12% have already been sold or used to fulfill obligations to early SAFE and options holders, and all remaining coins after the public sale will be re-allocated towards staking rewards (70%) and the Foundation (30%).|
|Team & Partners||25%||3-year vesting period, 10% of locked coins are stakeable for rewards on the MainNet||Allocated to project creators. Many team coins will initially be used to stake members of the BetaNet node community.|
|Foundation||10%||20% initial vesting period; 3-year vesting for remaining 80%||Allocated to grow the xx network ecosystem via partnerships, marketing and promotions, exchange listings and distribution, dApp development and events.|
From the start, over 90% of the xx network coin holders voluntarily locked their coins into 6-12 month vesting schedules starting at genesis and are staking those coins for rewards. xx coin will follow a deflationary supply curve for the first 5-6 years it is in circulation, with a small percentage of coins automatically burned at regular intervals in the xx network’s on-chain treasury. Afterwards, the xx network will gradually transition to an inflationary model with a maximum annual coin supply inflation rate of 6.5%, which will be distributed via block rewards to all xx coin holders staking on active nodes.
xx coin’s inflation rate will follow a curve, starting with higher inflation to support the early network before tapering down to maintain the network. The majority of the inflationary reward is given to the nodes and coin holders and a portion is transferred to the on-chain treasury, which is controlled by xx coin holders.
xx coin and the Future of Privacy
xx network’s economic model is designed to accelerate the inherent utility of a scalable, quantum-secure coin and leverage the growth and versatility of the platform’s native private messaging functionalities. In that respect, we believe the xx coin is essential to the future of online privacy.
We believe that your financial life and activity should be enriched and not threatened by technology, and our entire privacy-enhancing ecosystem is underpinned by xx coin, in terms of both on-chain governance and dApp development and usage. The positive flywheel effects made possible through the xx network’s quantum-resistant, stake-based consensus protocols enable the user growth and scale required to create a truly global, truly decentralized community of users.