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docs(token): revise token section (#1118)
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revises token section increasing detail around tokenomics

task: https://app.asana.com/0/1206208509925075/1207390169999740/f
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idea404 authored May 28, 2024
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2 changes: 1 addition & 1 deletion docs/site/docs/learn/omni/token/airdrop.md
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# Genesis Airdrop
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# Token Supply & Distribution
# Token Distribution

**\$OMNI** is an ERC-20 token launched on Ethereum L1 (deployed to [`0x36e66fbbce51e4cd5bd3c62b637eb411b18949d4`](https://etherscan.io/token/0x36e66fbbce51e4cd5bd3c62b637eb411b18949d4)) with a maximum supply of **100,000,000**. This section covers the supply & distribution of **\$OMNI**'s tokenomics.
## Genesis

At genesis, **\$OMNI** had a circulating supply of 10,391,492 (10.39% of total supply). **\$OMNI** is distributed across the following categories:

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**29.5% – 29,500,000 **\$OMNI****

Developers building with Omni are the key to ushering in a new generation of globally accessible applications across all Ethereum rollups. Omni is committed to fostering a thriving developer community building on the Omni EVM and across Ethereum’s rollup ecosystem. **\$OMNI** tokens reserved for the Ecosystem Development category will be initially used at the discretion of the Omni Foundation. In the future, this responsibility will be transitioned to token holder governance. At genesis, 496,492 **\$OMNI** entered the circulating supply for early validator rewards and network bootstrapping.
Developers building with Omni are the key to ushering in a new generation of globally accessible applications across all Ethereum rollups. Omni is committed to fostering a thriving developer community building on the Omni EVM and across Ethereum’s rollup ecosystem. **\$OMNI** tokens reserved for the Ecosystem Development category will be initially used at the discretion of the Omni Foundation. In the future, this responsibility will be transitioned to token holder governance.

## Community Growth

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The final portion of **\$OMNI** is allocated to advisors for expertise and guidance on network development. 625,000 **\$OMNI** will be unlocked at genesis while the remaining tokens will be subject to a 3 year unlock schedule that includes a 1 year cliff. 875,000 **\$OMNI** will be unlocked after the 1 year cliff, followed by 437,500 **\$OMNI** unlocked every 6 months for the remaining 2 years.

# Total Supply
## Total Supply

<figure>
<img src="/img/circulating-supply.png" alt="Circulating Supply" />
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43 changes: 43 additions & 0 deletions docs/site/docs/learn/omni/token/economics.md
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# $OMNI Economics & Token Utility

This section covers the supply & distribution of **\$OMNI**'s tokenomics.

## Supply

### Validator Rewards and Inflation

Incentivizing Omni validators is crucial to the safety of the network. Initial validator rewards will come from the Ecosystem Development category (29.5% of supply) and are used to reward validators for staking restaked **\$ETH** or staking **\$OMNI**. The proportion of rewards distributed for restaked **\$ETH** and staked **\$OMNI** will be dynamic, allowing the network to incentivize more or less of a given asset over time. For example, if the network requires more restaked **\$ETH**, then restaked **\$ETH** would have a higher reward rate than staked **\$OMNI** and vice versa.

Currently, EigenLayer does not support payments to operators (Omni validators) for their restaked **\$ETH**. EigenLayer also does not yet support slashing for restaked **\$ETH**. Due to these limitations, the Omni network cannot safely support restaked **\$ETH** as a part of its security system. Support for restaked **\$ETH** will be added for Omni validators when these conditions are met.

Today, **\$OMNI** stakers are receiving 6% APR in **\$OMNI** for helping to bootstrap the network’s security. When Omni mainnet v1 is live, the Omni Foundation will release a new validator rewards schedule with a fixed amount of **\$OMNI** distributed each month. These **\$OMNI** rewards will be split dynamically between **\$OMNI** stakers and **\$ETH** restakers depending on market conditions as described above. When governance is fully transitioned to **\$OMNI** holders, the community will be able to modify this rewards schedule and the parameters that determine the rewards split between **\$OMNI** stakers and **\$ETH** restakers.

Initial estimations project the allocated validator rewards from the Ecosystem Development category to be used for 3 years after Omni mainnet v1. Validators will always need to be incentivized with newly issued rewards and governance will need to determine this perpetual **\$OMNI** issuance rate. However, this does not mean **\$OMNI** will be inflationary — if **\$OMNI** burn outweighs the **\$OMNI** rewards issued to validators, **\$OMNI** will become net-deflationary.

## Demand

**\$OMNI** can be used as the gas payment mechanism for all Omni transactions or as a Proof-of-Stake security mechanism. **\$OMNI** used for transaction payments is burned. Staking or delegating **\$OMNI** to be staked earns staking rewards and governance rights.

### $OMNI for Gas

**\$OMNI** functions as the gas token for two types of transactions: cross-rollup transactions and Omni EVM transactions.

1. **Cross-Rollup Transactions**

Cross-rollup transactions (`XMsgs`) can be transmitted between any Ethereum rollups. The user pays for source network gas, destination network gas, and relayer fees when a cross-rollup transaction is initiated on a source network. In V1 of the protocol, users will only be able to pay fees using the native gas asset from the source rollup network. In V2, users will be able to pay fees using any token.

In V1, the Omni Foundation will operate the relayer and collect fees as two independent processes. In V2, Omni will implement an in-protocol mechanism for payments to relayers, transforming **\$OMNI** into a gas abstraction primitive. Under this new model, relayers bid for the right to relay messages in **\$OMNI**. The winning relayer receives the fee paid by the user on the source network while the **\$OMNI** paid by the relayer is burned. The winning bid amount will be equal to the transaction’s gas cost on the destination rollup network + the relayer’s service fee.

2. **Omni EVM Transactions**

**\$OMNI** is the native gas token that powers all transactions on the Omni EVM similar to other Layer 1 blockchains. The Octane framework allows the Omni EVM to natively inherit all of the EVM’s historical upgrades. This includes support for EIP-1559 which introduces deflationary burn mechanics into the system. Like Ethereum, **\$OMNI** fees associated with Omni EVM transactions are split into base fees and priority fees. Base fees are set at the network level and are burned, creating deflationary pressure for **\$OMNI**. Priority fees are set by the user and are given to validators. Priority fees open the door for an MEV marketplace to develop similar to Ethereum and other smart contract networks.

### Staked $OMNI

In addition to its role as a gas asset, **\$OMNI** is also used to generate economic security in the network’s Proof-of-Stake security model. Since this security model is a dual staking model, the total cryptoeconomic security of the network is equal to the value of staked **\$OMNI** + restaked **\$ETH**. Staked **\$OMNI** can be slashed if a validator misbehaves or is offline for an extended period of time. Any slashed **\$OMNI** is burned.

Validators that stake **\$OMNI** and users that delegate **\$OMNI** are eligible to receive staking rewards (currently 6% APR) and airdrops given to the Omni Foundation. Additionally, when the network decentralizes governance, staked **\$OMNI** will provide governance rights to users proportional to the amount of **\$OMNI** they have staked or delegated. These governance rights will allow users to propose changes to the protocol and vote on others’ proposals. Early staking is live on the Omni [staking portal.](https://claims.omni.network/)
11 changes: 11 additions & 0 deletions docs/site/docs/learn/omni/token/overview.md
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# Overview

**\$OMNI** is an ERC-20 token launched on Ethereum L1 (deployed to [`0x36e66fbbce51e4cd5bd3c62b637eb411b18949d4`](https://etherscan.io/token/0x36e66fbbce51e4cd5bd3c62b637eb411b18949d4)) with a maximum supply of **100,000,000**. 3% of the supply (3,000,000 **\$OMNI**) was distributed at Genesis as part of the Genesis Airdrop.

The **\$OMNI** token serves several crucial roles within the Omni protocol. **\$OMNI** can be used to pay for gas to process both cross-rollup transaction requests and Omni EVM transaction requests. All **\$OMNI** gas fees are burned from circulation. **\$OMNI** can also be staked by or delegated to Omni validators to contribute to the network’s economic security. Staking or delegating **\$OMNI** earns rewards and will allow users to participate in network governance when it is live. Users can stake their **\$OMNI** today by visiting the [staking portal.](https://claims.omni.network/)

More details regarding **\$OMNI**’s supply and demand dynamics are covered in the following **\$OMNI** Economics sections.
56 changes: 28 additions & 28 deletions docs/site/pnpm-lock.yaml

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4 changes: 2 additions & 2 deletions docs/site/sidebars.ts
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},
{
type: "category",
label: "Omni",
label: "The Network",
className: "sidebar-title",
collapsible: false,
items: [
"learn/omni/restaking",
{
type: "category",
label: "Token",
label: "$OMNI",
className: "sidebar-title",
collapsible: false,
items: [
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