SOAP (Subsidized Open-market Acquisition Protocol) is like merge-mining, but instead of paying the subsidy chain’s reward to the miner, the reward is paid to a protocol address that sells the parent token at market and buys QUAI at market. Those purchased QUAI are then either burned or streamed as time-deferred incentives to users who lock QUAI.
Goal: SOAP takes the potential negative economic impact of mining Proof-of-Work networks and turns it into a positive. This guarantees growing daily volume. With even modest non-mercenary hash, daily flow is expected to always be net-positive.
Launch Economics
- Buy & allocate: 100% of subsidy chain proceeds initially buy QUAI. All purchased QUAI are either burned or routed to a time-deferred locking rewards vault (trailing distribution; minimum ~30 days).
- Bootstrapping TVL: At launch, most purchased QUAI will go to locking rewards to attract new capital and deepen TVL; over time, the rewards share can taper as hashrate (and subsidy chain inflow/daily QUAI buys) grows, making rewards a smaller percentage of total daily buys.
- Timing tailwind: If QUAI rewards have ≈ two-week maturity, buys begin ~14 days before any newly minted QUAI can be sold—front-running typical sell pressure.
- Locking tailwind: Quai currently serves as a Store of Value, Gas Token, and Utility Token for the network. This will create an attractive yield component for capital investors.
Example Scenarios
Two quick example scenarios with illustrative math assuming subsidy chain flows cause SOAP to purchase $20,000 of QUAI per day.
- Early bootstrap (small TVL, big headline APY):
- Daily QUAI purchased → $20,000/day (all directed to locking rewards at launch).
- TVL locked → $500,000.
- Simple APR ≈ $20,000 × 365 / $500,000 ≈ 1,460%.
Interpretation: extremely high initial APY to attract lockers and deepen TVL.
- Scaled TVL targeting ~30% APR:
- Keep purchases at $20,000/day to rewards.
- Solve for TVL that yields ~30% APR: TVL ≈ $20,000 × 365 / 0.30 ≈ $24.3M.
Interpretation: with deeper TVL, APR normalizes to healthy levels while daily buy flow remains strong.
Context: the immediately tradable QUAI inventory on exchanges is around $2.1M
Over time, the rewards share can step down as hashrate and subsidy chain inflows/Quai buys accelerate, so incentives become a smaller slice of growing daily buys while the absolute buy pressure into QUAI keeps increasing.
Why this Helps Security and Scale
SOAP can accept shares from multiple algorithms (e.g., scrypt, SHA-256) alongside the primary block-finding algo. That widens hardware participation, diversifies security, and lets subsidy conversion keep scaling under growth – without disrupting block timing or difficulty.
What Pools & Miners Experience
To subsidy chain pools, SOAP makes QUAI look like a meta-pool: they construct a normal coinbase that pays the protocol address and includes a tiny reference. Miners keep using standard Stratum V1/V2 flows and extranonces with no firmware changes. On QUAI, nodes verify a lightweight proof that the subsidy chain block paid the right address and referenced the QUAI work, then proceed as usual.
Near-Term Timeline
- Testnet deployment window: Oct 2–9, 2025
- Mainnet activation (fork) target: Oct 16–23, 2025 (≈ two weeks after testnet go-live)
Activation specifics (height/MTP) will be published with the release notes and included in node defaults.
Additional Technical Details
Economic Intuition: Why this Matters
Worst case is daily net zero from mining: In a plain PoW system, miners sell some rewards daily equalling persistent sell pressure. SOAP’s buy and burn offsets with a matching stream of subsidy chain funded purchases. In the worst case, that cancels out mining’s natural sell flow (net 0).
Likely net positive most days: In practice there’s always some non mercenary hashrate (miners/pools aligned with the network, or indifferent to perfect arbitrage). That tends to leave a surplus of subsidy chain funded buys over miner sells so most days become net positive order flow for QUAI.
Virtuous circle (not a promise): More subsidy chain funded buying → price tends to improve → more hashrate → QUAI security rises → subsidy chains find SOAP more attractive → more subsidy flows → more buy and burn.
Security Intuition: Multi Algorithm Mining
SOAP lets QUAI accept shares from multiple proof algorithms (e.g., scrypt from LTC/DOGE and SHA 256 from BTC) alongside the primary block finding algorithm (e.g., KAWPOW). Shares don’t create QUAI blocks; they credit external work and channel more subsidy chain rewards into buy and burns. This has two effects, broader hardware diversity and stronger security. Different hardware (ASICs, GPUs) contribute via their native algos, making it harder for any one hardware class to dominate.
Headroom to keep growing under full subsidy: If block production is already full, adding share capacity from other algos lets the system continue to scale the subsidy chain to QUAI conversion without destabilizing block timing or difficulty resulting in more ways to contribute while using the same stable consensus mechanism.
Why This Improves Miner Economics
Stacked earnings: Miners keep their QUAI block rewards and benefit from subsidy chain funded buy and burns that can support QUAI liquidity and price.
No new headaches: Pools build standard coinbases and hand out standard jobs; miners still vary the extranonce and nonce exactly as today.
Fails safe: If the subsidy chain path goes quiet (or a signer set rotates), QUAI blocks continue normally. SOAP is additive, not a liveness dependency.
Governance & Rotation
A small committee signs simple templates that specify the subsidy chain payout script and header knobs. QUAI only accepts subsidy chain work that matches a valid, quorum signed template and includes the reference to the QUAI work. Keys are rotatable (e.g., 2 of 3 threshold) so you can replace a compromised key and advance to a new epoch cleanly.
For additional details see QIP-16.