Quai Network’s Golden Age Testnet introduces a unique feature for miners: the ability to earn yield on mining rewards through configurable lockup periods. Additionally, the testnet implements conversion lockups, adding another layer to your mining strategy. This feature not only incentivizes miners but also paves the way for native DeFi primitives within a Proof-of-Work (PoW) blockchain. In this blog post, we’ll delve into how lockups work, the benefits they offer, and how you can maximize your mining strategy.
The Basics of Reward Lockup
When you mine blocks on the Quai Network, your rewards are immediately paid out but are subject to a lockup period. This means:
- Quai Block Rewards: Sent to your coinbase address after the lockup period has elapsed.
- Qi Block Rewards: Immediately credited to your balance but are considered “not spendable” until they’re unlocked.
The lockup period is configurable, allowing miners to choose how long they wish to lock their rewards. This is set using the –node.coinbase-lockup flag during your node setup.
Configuring Your Lockup Period
Quai Network offers flexibility in choosing your lockup period, each with corresponding incentives. Here’s a breakdown:
| Value | Period (blocks) | Period (days) | Reward Boost |
|---|---|---|---|
| 0 | 7,200 | ~0.41 | +0% |
| 1 | 30,240 | 1.75 | +4.17% |
| 2 | 60,480 | 3.5 | +10% |
| 3 | 120,960 | 7 | +25% |
By selecting a longer lockup period, you receive a higher reward boost, increasing your overall mining yield.
Introducing Conversion Lockups
In addition to mining lockups, the Golden Age Testnet implements a default lockup period for conversions. During the testnet phase:
- Conversion Lockup Period: All conversions have a default lockup of half a day.
Conversions involve exchanging tokens within the Quai Network ecosystem, such as swapping between Quai and Qi tokens. The lockup period means that after initiating a conversion, you must wait for the specified time before the converted tokens become available for use.
Balancing Mining and Conversion Lockups
To optimize your mining strategy, you’ll need to balance the lockup periods of both mining rewards and conversions. Here’s how:
- Speculating on Hashrate Fluctuations: By understanding network hashrate trends, you can decide when to mine for maximum rewards and when to convert tokens.
- Managing Liquidity: Longer lockup periods increase rewards but reduce immediate liquidity. Consider your need for accessible funds when choosing lockup durations.
- Strategic Conversions: Timing your conversions to coincide with expected peaks or drops in hashrate can enhance your overall returns.
By carefully balancing these factors, you can maximize your yield while participating actively in the network.
Why Implement Lockups?
Introducing lockups during the testnet phase serves multiple purposes:
- Incentivizing Miners: Encourages miners to participate actively and hold their rewards, promoting network stability.
- Enabling DeFi Primitives: Lays the groundwork for decentralized finance applications directly on the Quai Network.
- Understanding Miner Preferences: Allows the development team to observe miner behaviors and preferences regarding reward strategies.
- Analyzing Token Supply Dynamics: Helps assess how lockups affect token supply, especially as miners exploit hashrate fluctuations to optimize rewards.
- Encouraging Strategic Participation: With conversion lockups, miners must plan their actions more carefully, fostering a more engaged and strategic community.
This feature is a step towards enhancing the utility of both Quai and Qi tokens, offering more use cases and fostering a robust ecosystem.
Viewing Your Mined Blocks
Currently, miners might notice that not all mined blocks are visible on Quaiscan or Pelagus. This is because locked rewards aren’t being indexed yet—a feature the core protocol team is actively developing.
In the meantime, you can track your mined blocks by checking your stratum miner logs. Here’s how:
- Access Your Logs: Navigate to your miner’s log files, which record all mining activities.
- Review Mined Blocks: Look for entries that indicate successful block mining.
- Need Help?: If you encounter issues, feel free to ask questions in our support channels or refer to the Stratum Miner Guide.
Rest assured, once the indexing feature is implemented, we’ll update our channels and documentation to keep you informed.
Maximizing Your Mining Strategy
To make the most of your mining efforts:
- Choose the Right Mining Lockup Period: Balance between immediate liquidity and higher rewards from longer lockups.
- Plan for Conversion Lockups: Remember that conversions are locked for half a day. Factor this into your strategy, especially if you aim to capitalize on short-term market movements.
- Stay Informed: Keep an eye on network hashrate trends to capitalize on peaks and valleys.
- Monitor Network Updates: Changes to lockup policies or network conditions can impact your strategy.
- Read More: For in-depth strategies, check out our blog post on Maximizing Mining Strategy in Quai Network.
Looking Ahead
As we progress towards the mainnet launch, these features will become integral to how miners interact with the Quai Network. Your participation and feedback during the testnet phase are invaluable, helping us refine and optimize the network for everyone.
Stay tuned for updates on indexing locked rewards and other exciting developments. For any questions or assistance, our support channels are always open. Together, we’re building the future of decentralized networks with Quai.