BTCST — Note on Mining Rewards Calculation
Each Bitcoin Standard Hashrate Token (BTCST) represents one 0.1 TH/s of Bitcoin hashrate. Staking BTCSTs in the project dApp mines real BTC. Because BTCST distributes mining rewards among staking participants the DeFi way, mining yield from BTCST could be significantly more than that of direct Bitcoin mining.
Here is how.
Step 1. Receive Gross Mining Rewards from Mining Pool
Each day, BTCST will receive from our partner mining pool gross Bitcoin mining rewards generated by the project’s aggregate mining power. For example, if the total supply of BTCST is 10,000,000, the project should receive Bitcoin daily mining rewards that 1,000,000 TH/s of Bitcoin hashrate can collectively generate.
Real-time and historical data on how many Bitcoins each TH/s can generate on a specific day is available here.
Step 2. Calculate and Deposit Net Mining Rewards to dApp
The BTCST project team will follow the whitepaper to calculate and deduct energy costs from gross daily mining rewards. The amount of Bitcoins left is the net daily mining rewards.
- If less than 60% of the total supply of BTCST is staked in the dApp, the project team would still deposit 60% of net daily mining rewards to the dApp to be shared by the staking participants. For example, if in fact only 20% of BTCST are staked, these staking participants will effectively receive triple daily rewards. The remaining 40% will be reserved under the supervision of our partner mining pool as hashrate safety deposit and for market-making funds.
- If more than 60% of the total supply of BTCST is staked in the dApp, the daily share of the project’s safety deposits and market-making funds will be proportionally re-allocated to ensure that the dApp’s staking participants receive their rewards in full.
Here is an illustration of how this process could significantly boost yield for staking participants — 0.288426 bitcoin was deposited into the dApp on Jan. 6, 2021. This daily reward was claimable by 40,000 staked BTCSTs, which represent 4.0 PH/s of Bitcoin hashrate. In other words, the net daily profit per PH is 0.000721 bitcoin, a yield at least 14.0 times better than that of direct Bitcoin mining.
Step 3. How BTCST dApp Determines Shares of Each Staking Participant
Only BTCSTs staked through a full day (specifically, from 8:00 pm Singapore time on Day 1 to 8:00 pm Singapore time on Day 2) are entitled to share the daily rewards.
To show how the process works, assume that the total amount of distributable rewards for Day 1 is three Bitcoins, and there are only two staking participants, A and B:
- At the beginning of Day 1, A had 10,000 BTCSTs staked. A staked an additional 10,000 BTCSTs during the course of Day 1.
- At the beginning of Day 1, B also had 10,000 BTCSTs staked. B un-staked and then re-staked 5,000 of these BTCSTs during the course of Day 1.
- For A, 10,000 BTCSTs have staked through Day 1. For B, only 5,000.
- Therefore, for Day 1, A is entitled to claim two Bitcoins, and B is entitled to one.
BTCST is a token collateralized by real Bitcoin mining power. By staking BTCSTs, holders of the tokens will receive daily Bitcoin distributions that correspond to the mining power staked. With BTCST, you mine Bitcoin the DeFi way.
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