We are proud and extremely excited to announce our new staking mechanism, Pinnacle Staking.
There is nothing like it in the world and we already have partners interested in utilizing this game changing system for their own tokens. Pinnacle Staking hasn’t even been launched yet and it is already drawing developers towards Redlight Chain.
This system is meticulously designed to reward supporters who believe in the future of a coin or token, whilst also combating any downwards pressure that affects alternative staking systems.
Staking protocols have always been an important part of crypto, both for new and old projects. They allow communities that see potential growth in a product or ecosystem to be rewarded for their market insights, as well as providing added utility to the token itself.
Projects that introduce staking early on in their development tend to experience significant sales pressure, caused by users selling their rewards - which therefore makes some forms of staking counterproductive.
Redlight aims to solve this problem by creating a more robust staking protocol, Pinnacle Staking.
Pinnacle Staking is a hybrid of traditional staking mechanics and tiered staking systems. By introducing new mechanisms which encourage growth-orientated game-theory, this new innovation has the ability to encourage the price growth for projects and significant rewards for participants.
The game-theory aspect comes into play where users will be able to leverage predictive staking positions to enable higher rewards via bonus multipliers, which, in-turn, benefits them by generating higher returns.
Pinnacle Staking consists of a two phases, which include a series of different variables such as:
Peaks
Phase one begins with Peaks. Each peak has different variables such as price targets that participants stake into, when each peak is unlocked the participants who have tokens in that peak will have them unlocked, then they can withdraw them along with their extra tokens they gained from the multiplier (if applicable).
There can be any different amount of peaks active at any time, which is up to the protocol owner to decide. They can also continue to add higher peaks as the token increases in value.
The protocol owner will also be able to decide on many other variables.
For example: A protocol may decide to have 5 different peaks in their Pinnacle Staking, which would effectively mean there are 5 different price unlocks.
As you can see, each peak unlocks at the price point designated, and the Peak Pool is released – unless the participant chooses to roll their funds over into a Pinnacle Pool to gain more rewards (explained later in this article)
Peak Spreads
Peak Spreads are a set of controls that the protocol owner is able to set for their Pinnacle Staking, to ensure equal access to all peaks among participants
For example: A protocol may decide on having 5 Peaks in total, however, they may cap access so each participant can only participate in 4 Peaks. They will also be able to limit the max % of the total amount of tokens a user can put in each Peak. Let’s say the protocol had a Peak Cap of 4 Peaks with a cap of 25% per Peak. This means that a user will need to spread the amount of Tokens they want to add to Pinnacle staking into 4 of the 5 Peaks equally.
Unlock Price
The Unlock Price is the price that participants will be able to commit their staked tokens to.
For example: If a token is currently $1.00, the first peak's unlock price may be set to $1.50. If a user commits 100 tokens to the first peak, this means that once the unlock happens those tokens will be valued at $150 in total.
Unlock Hold Time
The Unlock Hold Time is the amount of time that the token will need to be at or above the Unlock Price, before it actually unlocks.
For example: If we use the same example as before, and apply a Peak Unlock Hold Time of 30 days, this means that the token will need to be at or above $1.50 (The Unlock Price) for 30 days, before a user will be able to claim/unlock their tokens. The way this will be calculated is based on the total amount of blocks that the price of the token has been above the Unlock Price (i.e 30 days worth of 2 second blocks is 1,296,000 blocks). By having the Unlock Hold Time work this way it means that the price will need to be above the Unlock Price for 30 days in total, so if the token drops down in price for a few days it can always make up this time once it goes above the Unlock Price again. This is to protect from price manipulation leading to unwarranted unlocks.
Unlock Multipliers
Unlock Multipliers are bonuses that can be leveraged at the time of unlocking a peak, this is essentially the ROI that is given to the user. The Unlock fees are fully customizable and are by no means a requirement to have included. The protocol owner would need to provide the extra tokens to be available for Unlock Multipliers.
For example: The protocol may decide to have no Unlock Multiplier for the first Peak, but have a Unlock Multiplier of 10% for the second Peak. This means if a participant staked 100 tokens, and received a 10% Unlock Multiplier, they would be able to withdraw 110 tokens once they reach their targeted Peak.
Unstake Fees
Unstake Fees are fees that will be paid to the protocol owner whenever a user unlocks their tokens. The Unstake Fees are fully customizable and are by no means a requirement to include. The protocol owner could have these fees go towards their treasury, burning pools, community giveaways, or whatever else they decide upon.
For example: A protocol may have a higher Unstake Fee for lower Peaks, a lower Unstake Fee at higher Peaks, and completely remove the Unstake Fee at the highest Peak. If we use the same example as before, the Unstake Fee may be 25% for the first Peak which was at $1.50, which means that the person who put in 100 tokens wouldn’t receive the full 100 tokens at the unlock, they would receive 75 and 25 would go to the protocol owner.
Peak Pools
A Peak Pool is the amount of tokens that the protocol owner allows to be entered into each Peak.
For example: A protocol may decide to have 5 different Peaks, and 250,000 tokens in total as a maximum amount that can be added to the Peak Pools. They may decide to have 50,000 tokens in each of the Peak Pools, or they may skew this, having more available in the higher Peaks and less in the lower Peaks, or vice-versa.
Pinnacle Pools
The Pinnacle Pools are Phase two of the Pinnacle cycle, and are completely optional. Once a token has reached an Unlock Price, and holds this price for the Unlock Hold Time required, the user will have a choice between simply unlocking their tokens, or entering the Pinnacle Pools. When entering the Pinnacle Pools, users will receive a further Pool Entry Multiplier.
All tokens that enter the Pinnacle Pool, will be eligible for receiving further daily rewards. The amount of rewards receivable will be up to the APR set by the protocol owner. The Pinnacle Pool can have a higher Unlock price, lower Pool amount (cap) and a separate Unlock Hold Time (from the first phase of Pinnacle Staking) to ensure people are not just using this to bypass the Unstake Fee.
The Pinnacle pool acts as an extra incentive for those that see future potential growth in the project. This allows for them to enter a new staking pool that is only accessible by participating in the first Phase of Pinnacle Staking.
Pool Multiplier
The Pool Multiplier acts as a weighted bonus that gets applied to the tokens entered. This is designed so that those who have committed to a higher Peak initially that want to enter the Pinnacle Pools will be rewarded by adding phantom weight to the pool. This means they will have a bigger stake in the pool than someone who entered from a lower peak with the same amount of initial tokens.
Once a user decides to Unstake from the Pinnacle Pool, they will only receive the initial tokens entered, not the phantom Tokens applied by the Pool Multiplier.
The protocol owner will be able to set variable Pool Multipliers, as well as Pool Spreads (Similar to Peak Spreads - essentially limits on the amount of tokens that can enter the Pinnacle Pools at each peak).
Here are some examples to showcase the difference between someone only participating in Phase One, and someone participating in both Phases.
Option One: Unlock the tokens they are eligible for, minus any Unstake Fees and adding any Unlock Multiplier they are eligible for.
Example One:
Option Two: Move their tokens to the Pinnacle Pools. This option negates any Unstake Fees, but still has the Unlock Multiplier applied, as well as the Pool Multiplier.
Example Two:
As you can see, there are many different strategies that can be applied to both phases of Pinnacle Staking based on the individual's vision for potential growth and their risk appetite.
Before we launched our first ever protocol over a year ago, we said from the get go that our Redlight Link (Formerly VIP NFT) will receive added bonuses to anything Redlight related, and we stand by this statement.
Anyone who holds a Redlight Link, will automatically receive a 10% bonus multiplier when entering the Pinnacle Pools for all Pinnacle Staking protocols created by Redlight. This means in the Example Two above, you would actually receive a 1.65x Pool Multiplier rather than a 1.5x Pool Multiplier.
When doing this, the Redlight Link will be staked in the Pinnacle Pool to stop people from transferring this between multiple wallets to game the system.
We at Redlight believe that those who participate in Pinnacle Pools should be recognized even further for their commitment. This is why we will be providing Accolade NFTs to all entrants.
Accolade NFTs will be non tradeable, and will be showcased on users' Redtag profiles once this is live. Accolade NFTs will be seasonal, meaning that the only way to get the Season 1 Accolade NFT will be by entering the first Pinnacle Pool we release. The only way to get the Season 2 Accolade will be by entering the second Pinnacle Pool we release and so on.
People who hold Accolade NFTs will be eligible for different air drops, special events, partner whitelists and more.
Redlight will be implementing a form of Pinnacle Staking into the Rebate Program utilizing wREDLC. We have also given a high level overview of Pinnacle Staking as a Service to some of our partners, some of which will be implementing this feature. The only way to enter this particular Pinnacle Staking Pool will be via the rebate (i.e. you won’t be able to add REDLC to this from your wallet, only from the rebate). A detailed breakdown of the Rebate Pool parameters will be coming in a separate announcement.
As the Pinnacle Staking variables are completely customizable by protocol owners they may decide to remove some features, or even add some that we haven’t thought of. We encourage any protocol owners who may have an interest in this to reach out to us in discord or telegram.
Pinnacle Staking has a lot of moving parts so it can be a lot to fully comprehend, but we are excited to showcase just how well this can work once we have utilized this in the Rebate Program as a proof of concept.
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