PolkaCipher’s Economic Incentive Model: Everything You Need To Know
PolkaCipher is an oracle-focused solution that links on-chain blockchain solutions to real-world data through NFTs, providing privacy for businesses, community governance, multichain interoperability, and on-chain DeFi apps. The platform plans to offer these services through an economic incentive model.
Design and implementation
The economic incentive model of PolkaCipher is made possible through a robustly designed and implemented strategy and token utility that creates revenue generation points for various participants in the PolkaCipher ecosystem. The core functions of PolkaCipher’s Economic Incentive Model includes:
- Request and response processing
- Result verification
- Node registration
- Mortgage and statistical monitoring
- Payment processing
Each function consists of tasks that can be completed by supporters and users of the platform, with some functions attracting a small fee payable by the platform’s predetermined token.
- Nodes serve the platform by mining, among other activities.
- Through mining, they can gain rewards, which are paid out in the predetermined token.
- The mining rewards are determined on-chain based on the system architecture that is part of the design plan of the platform.
- Profitability in the platform is only possible through productivity.
PolkaCipher uses a reward/penalty system to encourage productivity and eliminate laziness in its ecosystem. Rewards are given to nodes that perform the set tasks in the given time limit. Nodes that delay are penalized, and because they work in groups, the credibility of the entire group is also questioned. This system encourages nodes to diligently perform their tasks to earn their rewards and give other platform participants a chance to generate extra revenue.
$CPHR token utility
The use of tokens in PolkaCipher creates possibilities for revenue generation. For example, as mentioned earlier, PolkaCipher plans to use NFTs to offer real-world solutions through blockchain mechanisms. Through its native token, $CPHR, users of the platform can purchase NFTs for transactions or use the token alongside other stable coins as collateral to get liquidity.
Users can also gain value by staking their $CPHR. Data reception on PolkaCipher requires payment of some tokens. This can be avoided entirely if a user stakes a certain number of tokens in the ecosystem. Staking is done after each mining cycle with a minimum of 10 $CPHR required to access data reception.
These two systems are crucial in the ecosystem as they ensure a constant flow of tokens, which is essential to the economic success of the platform.
Hashed time-locked contracts NFTs can be used to access permissioned communities. This will add an important layer of security and increase the exclusivity of some applications in the decentralized ecosystem. Other anticipated implementations include gaming, web-app logins, and store purchases.
PolkaCipher is a privacy-preserving oracle network on the Polkadot Blockchain focused on bringing the use case of private NFTs to off-chain businesses and be a bridge for seamless integration to on-chain Defi apps.
PolkaCipher’s unique offerings help push the use-case of the NFTs in real-world scenarios while still being connected to a cross-chain network that is fair and accurate. PolkaCipher intends to achieve business goals by helping users transact privately and securely using NFTs as a mode of access to different decentralized apps (Dapps) and real-world business rewards.
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