What is xDai (STAKE) | What is STAKE token

POA Network has launched the first-ever blockchain where the native currency of the chain is USD-stable. xDai Chain, an Ethereum compatible sidechain with Dai as the native currency of the network, combines POA Network’s interoperability knowledge and technology with MakerDAO’s Dai, the permissionless, crypto-collateralized USD-stable coin.

Features

The following features make xDai a unique and secure sidechain solution.

Native Stable Coin

A stable coin means peace of mind. Predictable currencies allow buyers and sellers to exchange value without the risks of volatility. In the xDai Stable Chain implementation, transactions are conducted using xDai, a stable coin with 1:1 value ratio to Dai. Because transactions occur on a bridged sidechain, they are extremely fast and inexpensive. In addition, transactions and fees are paid with a single coin.

Neutral Network

The xDai chain provides a vital public utility for users - the ability to transfer stable value free of speculative concerns, volatility, or FUD (fear, uncertainty & doubt). xDai is an independent network, built to support transactions that hold value. When DAI is bridged to xDai, it moves to a platform with a clear, transparent purpose; secure & stable transactions on a fast, neutral network.

xDai’s value is not determined by crypto-market forces, removing much of the drama that permeates the blockchain space. Open governance, open access, and token stability create a trusted environment for users as well as applications built on top of xDai.

On-Chain Randomness

Using a RANDAO-based Random Number Generator, validators on xDai produce random numbers used for validator selection. These random seeds are also available for usage by contracts deployed to xDai. This allows for true on-chain randomness, eliminating the need to rely on a centralized service or 3rd party application. More information on how the xDai RNG works is available here.

DPOS Consensus

To move to a permissionless structure, the xDai Stable Chain will adopt a delegated Proof of Stake (DPOS) consensus mechanism. Private POS consensus is already underway, and phase 2 will bring public staking to the xDai chain. The POSDAO white paper describes all aspects of this new consensus protocol, called POSDAO consensus, including a complete overview of the theory, rationale, security, and a detailed implementation section.

Multi-Chain Staking Token

The STAKE token will be used by validators and delegators to secure the xDai chain. Users will have the opportunity to participate in chain consensus, either as validators running xDai nodes, or delegators placing stake on those nodes. While participants will place STAKE to secure the chain, they will receive rewards in both STAKE and xDai thanks to unique reward mechanics.

Additional sidechains will also have the opportunity to use STAKE to secure their chains, making this the first multi-chain enabled staking token.

Bridges to Ethereum

Two bridges connect the xDai Stable Chain to the Ethereum mainnet, supporting seamless two-way asset transfer between chains. Tokens are acquired on the mainnet, then bridged to the xDai Stable Chain sidechain using either the Dai-xDai bridge for transactional tokens, or the OmniBridge for any cross-chain transfers. Once a user is finished transacting or staking, tokens can be bridged back to the mainnet with ease.

Bridged Tokens

View tokens that have been bridged to xDai with the OmniBridge using the OmniBridge UI built by RaidGuild

Welcome to xDai STAKE

The first-ever USD stable blockchain and multi-chain staking token

For users

The xDai Chain is a stable payments blockchain designed for fast and inexpensive stable transactions. xDai is used for transactions, payments and fees, and STAKE is used to support Proof-of-Stake consensus.

xDai is the ideal cryptocurrency for everyday payments and transactions. Fees are extremely low, payments are very fast, and the value remains stable at ~ $1 US Dollar per xDai. User-friendly tools make xDai easily adoptable for crypto and non-crypto users alike! Users only need xDai to complete payments (a single stable token for payments + fees).

STAKE is a multi-chain staking token designed to secure the payment layer. Staking allows block producers (validators and their delegators) to provide transaction consensus and receive staking incentives for honest block production. STAKE is not required for everyday chain transactions or users, it is only required for consensus providers. STAKE is also not stable, it is a volatile token whose value is determined by the marketplace.

See the dual token model for more on this innovative approach.

For developers

The xDai chain is an EVM sidechain that uses a different consensus model (POSDAO) than Ethereum. The underlying architecture, however, mirrors Ethereum 1.0, meaning that smart contracts can be written and deployed in exactly the same way using a different RPC endpoint.

Any contract that works on the Ethereum mainnet can be easily redeployed to the xDai chain. On the xDai chain, transaction costs are minimized, and all fees and transactions are paid with a single token, xDai.

For validators

Validators on the xDai chain provide consensus for transactions and secure the chain. Current xDai validators are well known organizations in the Ethereum community.

When xDai switches to public POSDAO and delegated Proof of Stake (Q3 2020), anyone with enough STAKE and the ability to run a node will have the opportunity to become a validator. Delegators in this model will help determine the validator set by placing stake on candidates they want to see become validators.

ELI5

xDai is the name of a blockchain AND the stable cryptocurrency used on the chain. Each xDai token is worth ~ 1 US dollar.

The xDai blockchain is a sidechain of the Ethereum blockchain. It has the same properties as Ethereum, but uses a different method to make sure transactions are valid and consistent across all nodes in the distributed network. Currently, known organizations (called validators) transmit and verify blocks every 5 seconds. This means transactions can be completed quickly and fees for transactions can be minimized. In the near future, xDai will transition to public staking where community members can also be nodes. See below for more on STAKE, the token that is used for Proof of Stake consensus.

xDai is a cryptocurrency created from the MakerDAO DAI token. Dai is a stable token on the Ethereum mainnet pegged to the US dollar. xDai can be acquired by users in a number of ways ( for example with a credit card) but behind the scenes it is always created from Dai, and the value of xDai always corresponds 1:1 with Dai.

Here’s how xDai is created:

Dai is locked into a smart contract on Ethereum. This means it must remain in that contract and cannot be moved until the contract receives a verified signal to unlock it.
Using a bridge mechanism called the TokenBridge, data about the locked Dai is transmitted to a smart contract on the xDai chain.
The contract on the xDai chain creates the exact same amount of xDai.
This xDai is then usable on the xDai chain. Users only need to switch the chain their wallet is pointing to, and xDai is available using the same Ethereum address.

When users want to exchange xDai for Dai, the process happens in reverse. xDai is burned (destroyed) in the xDai chain smart contract, and a verified signal is sent to unlock the exact same amount of Dai on the Ethereum mainnet. The unlocked Dai is then returned to the user’s address on the mainnet. The STAKE token is separate from xDai and is used to protect chain consensus. Validators commit a large amount of STAKE into a contract and agree that their nodes will produce blocks correctly and follow the rules. If they are successful and follow the rules, they receive additional STAKE as rewards. If they do not follow the rules, they are banned from the protocol for 90 days and their STAKE is locked and unavailable to withdraw.

Other community members can also delegate, or place STAKE on validators they would like to see running nodes in the network. Validators are selected each week based on how much STAKE is in their pools (STAKE they have provided as well as STAKE delegators have provided) as well as a random number, which makes sure the selection process is fair.

3 TOKEN MODEL

The 3-token model of Dai, xDAI and STAKE give the xDAI ecosystem its uniqueness. All three tokens provide value to the xDAI chain and provide vital roles in the chain’s functionality.

DAI

Dai is the stable asset built on the Ethereum mainet heavily used for DeFi applications and decentralized lending. 1 Dai equals 1 USD backed by multi-collatorized assets on the Ethereum blockchain. The Dai is used on the xDAI chain to be locked which creates the xDAI token.

XDAI

xDAI which is created by locking the Dai is a more efficient and effective stable coin compared to Dai. Once created, users can make transactions using xDAI which are more expensive and slower using the standard Dai token, like micro-transactions, payments for goods and services and transfers to individuals. The transactions are instantaneous (5 seconds) & low transaction fees (500 tx for $.01).

STAKE

The STAKE token is used to secure the xDAI chain and provides an incentive for holders to stake their tokens by becoming delegators or validators. As a reward for providing consensus to the xDAI chain, stakers are rewarded with both STAKE and xDAI. The real value of the STAKE token comes from being able to be staked on other sidechains. This makes the STAKE token the first ever multi-chain staking token, a truly ground-breaking achievement.

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For a more detailed overview of the xDAI staking model visit the teams info.

SWITCHING TO POSDAO CONSENSUS

The current consensus of the xDai chain is currently private dPOS which is validated by selected members of the Ethereum community. These include names like MakerDAO, POA Network and Giveth which receive transactional rewards from the network. xDAI will soon migrate into a more decentralized consensus POSDAO in Q3. This switch of consensus will enable a more decentralized consensus, allowing the community to take part in the growth of the network. Using the STAKE token, the community can use their tokens to validate or delegate to receive rewards as mentioned above.

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RANDOM NUMBER GENERATOR

A key feature of the xDAI network is the Random Number generator xDAI RNG, created on-chain use for validator selection. The random seeds generated can also be used for contract deployed on xDAI. The random number generator plays a key role in decentralization and eliminates the need for 3rd parties and centralized figures to carry out this process.

WALLETS

There is a growing list of already released xDAI wallets available for use. Each one has their own unique attribute catered for your use.

BURNER WALLET

The Burner Wallet which supports xDAI is a wallet which provides users a quick and easy way to transfer crypto. The wallet created by Austin Griffith is designed to be created and the burned once it has fulfilled its use, just as its name suggests. The wallet creates an Ethereum key pair when generated, which is then used to sign transactions. Think of it like a physical wallet you use in real life. At the beginning of the day, you insert the amount of money you need to get you through. At the end of the day, you empty the contents in a safe place. That is exactly how the burner wallet is designed.

The wallet was a big success in 2019, being showcased in events like ETHDenver and Ethereal NYC. The transaction costs for the meals being purchased at ETHDenver totalled to $0.20 processing $38,432.56 in DAI.

BURNER WALLET 2

The Burner Wallet two is the extension from the first Burner Ballet created by David Mihal. The burner wallet 2 has all the features of the original Burner Wallet as well as being stable, modular and extendable. The wallet was designed to enable developers to build plugins, custom wallets and extend functionality. Several applications are already for the Burner Wallet 2, including Burner Factory which enables users to build their ‘burner experience’ without having any coding skills. Companies like Helena, Ching and Sablier all have plugins that are being made.

The Burner Wallet 2 also gained a lot of attention, being prototyped in events such as the Escape Room at ETHBerlin, and a happy hour at ETHBoston and gained a lot of attention from participants at Devcon V and ETHWaterloo II.

xDAI is compatible on a growing list of wallets. For more details on all the available wallets click here.

HOW TO PURCHASE STAKE AND BEGIN STAKING WITH BITMAX?

STEP 1: BUY BITCOIN

Note: If you already own bitcoin (step 1), please skip to step 2.

Before you can purchase STAKE, you would first need to buy some Bitcoin. Don’t worry if you have never bought Bitcoin before, the process is more simpler than it sounds.

First create a coinbase account.

If you use my link we’ll both receive $10 free.

https://www.coinbase.com/join/bellam_2un

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Once you have done that, log back in to Coinbase. You will now need to add a phone number, and confirm this number by entering in a code that you will receive via text message. This is to prevent spam accounts being made, and adds an additional level of security to your account.

Before making purchases, you will need to verify your identity by uploading a picture of some form of ID, such as a driver’s license.

Once you have done that, you need to add some payment method to buy your coins. Under the settings menu, go to the “Linked Accounts” tab and click on “Link a New Account”.

You have several options, if you are looking to invest only a few hundred, I would recommend the debit card option as the other options can take time to process or you could be charged a fee.

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Once that is setup, click the trade option and select Bitcoin, then purchase the amount you require. When the purchase is complete you need to send the Bitcoin to Bitmax where STAKE can be purchased.

STEP 2: BUY STAKE

BITMAX

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Search BTC in the search bar.

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Click deposit. Here you will be presented with an address. Copy this address and then return to your coinbase accounts page to send the Bitcoin to your Bitmax BTC wallet address you have just copied.

After a while the Bitcoin transaction should have gone through. You can now go to Bitmax and click on the ‘cash’ tab on the top left.

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STAKE is currently only traded with the USDT pair so you need to purchase USDT with your BTC. Search BTC on the right hand side, make side the USDT tab is selected.

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Select the BTC/USDT ticker and enter the amount of BTC you wish to sell at your desired price.

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Now you have some USDT, search STAKE in the search bar above.

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Select the STAKE/USDT ticker and then enter the amount of STAKE you wish to purchase in the buy order box below.

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STEP 3: PRE-STAKING WITH BITMAX

With staking on the network not going live until Q3, Bitmax are giving token holders a chance to take part in pre-staking of the STAKE token. The 3 months staking program will offer stakers 36.4% APR on their collateral through the StakeVault feature and is the first project ever to do so. For a more detailed look into staking, view the instructions below.

Click on the ‘Staking’ tab at the top.

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