The chosen native blockchain is Qtum, and with this example, you will finally see in practice the simplicity and usability of our upcoming product. In the following article we will refresh your memory on what Pool of Stake is, give a short introduction of Qtum, and finally showcase our MVP on the Qtum testnet.
Let’s start with Pool of Stake. The goal is to create the first pool in which members can stake their Proof of Stake coins together, to create and share greater forging rewards without losing ownership of the coins or relying on third parties for trust. How are we going to do this? It is simple and possible thanks to Smart Contracts. Pool of Stake is a Smart Contract on native Proof of Stake blockchains (in the MVP on the Qtum blockchain). A member deposits his PoS coins to the PSK Smart Contract in exchange for an IOU token that will be deposited back to his or her wallet. All the coins in the PSK Smart Contract will be forging together and producing proportionally more rewards. The only way to retrieve the staked coins is by giving back the IOU- something that only the coin holder can do. The reward will be calculated daily at 23:59:59 CEST and registered in the IOU. Once the member wants to retrieve his initial PoS coins, plus any additional coins generated as rewards, he or she simply sends back the IOU token to the PSK Smart Contract and receives the reward. To make things better, Pool of Stake will have a token called PSK not to be confused with the PSK Smart Contract) that, depending on the amount held, will increase the forging rewards by reducing withdrawal fees. Now that we’ve cleared that up, let’s move on to Qtum.
Qtum is an open source blockchain project which’s core technology combines a fork of Bitcoin core, an Account Abstraction Layer allowing for multiple Virtual Machines including the Ethereum Virtual Machine (EVM), the use of Smart Contracts and Proof-of-Stake consensus aimed at tackling industry use cases. It additionally implements a Decentralized Governance Protocol (DGP) which enables it to easily scale for the future. Qtum has an edge over competitors like Cardano and EOS because it is already using tried and tested technologies that are proven to work. Qtum aims to develop the “public blockchain for business” by bringing its technology to financial services, supply chain management, social media, gaming, and other industries in the future.
Now, here comes Pool of Stake’s first MVP. You can find the code here:
After describing our project and Qtum, we will see how they interact. As already explained, Pool of Stake is a Smart Contract on the Qtum blockchain, to which the coin holder will deposit his coins in order to generate rewards. After depositing qtums, the Smart Contract deposits the IOU to the Qtum holder’s wallet. If he or she just wants to withdraw the qtums, he or she just has to send the IOU back to the Smart Contract address and the coins (plus any generated rewards minus the withdrawal fees) will be returned to the Qtum holder’s wallet. Here is how it looks like in images:
Smart Contract Address
qtum is deposited to this address
– tokens deposited here start generating forging rewards
– a deposit of qtum to this address will yield an IOU back to the sender’s address
– in MVP the IOUs are QRC 20 tokens called “PQM”
Qtum holder’s wallet
– this is the qtum holder’s wallet- qtum tokens are sent to the Smart Contract from here
– this wallet receives back the IOU/”PQM” tokens which can be seen in the “Token Tracker” section
– if the coin holder wants to collect his or her rewards, or simply return the qtums to the wallet, he or she just needs to send the PQM back to the Smart Contract, and receive the qtums and any generated rewards
A lot of people can find complications when trying to describe with words an abstract process. In reality, most blockchain applications tend to be a lot simpler than people expect, and examples tend to clear ideas. In this article, we saw the simplicity in which a user can generate rewards while always keeping his qtums safe. To recap, the process just consists of sending the qtums to the Smart Contract, which automatically sends PQM tokens to the wallet. Then, sending the PQM token from the wallet back to the smart contract in order to receive the Qtum and any generated rewards back. Tadaa!
If you find any difficulties, please do not hesitate to contact us and ask for support! We are happy to help!