THE WORBLI RESOURCE ECONOMY
Written by Worbli Team
KEY PRINCIPLES AND FEATURES OF THE WORBLI RESOURCE ECONOMY.
WORBLI is a platform designed for multi-layered financial services applications. On our platform, the WORBLI Token (WBI) represents constantand proportionate ownership of system resources. This is important for our enterprise customers who must have the ability to quantify and model their resource costs. In other words:
An application that requires X% of WORBLI resource capacity requires X% of WBI to stake.
Demand for WBI resource (“Utility”) is tantamount to demand for the WBI token and, as such, we consider the WBI value to be driven by the Utility of the network resources.
The WORBLI Resource Economy therefore revolves around Utility, those that participate in it and benefit from it.
We recognize that not all WBI holders are enterprise users or application owners. We have established a framework to allow WBI holders not accessing their resource to support the network’s Utility expansion and receive passive returns.
Our Resource Economy distributes further resource through WBI to both those running applications on WORBLI, as well as those lending their unused resource.
This optimizes resource capacity for those that need it, and facilitates a fuller capacity utilization of WORBLI resources, which is to the benefit of all WBI holders.
Our internal Resource Exchange provides daily leasing liquidity for short-term resource requirements for those running applications to avoid short term rebalancing costs.
Our framework is algorithmic, with minimal interaction, based on the system state on a daily basis, with no external market trading, or cost friction.
Utility drives the value of the network. Our model rewards Utility, allows passive returns to be generated and delivers that value back to all token holders with an optimized network.
THE COSTS OF RESOURCE
When we look at resource costs for our customers, we have to consider the implications for an application to hold WBI as a balance sheet asset for the duration of their resource requirement. The WBI purchase is not an absolute cost; the true cost is the risk associated with holding WBI for that period. Therefore, it is not so much about the absolute WBI price but the stability of the token over time.
A Resource Distribution model, as a function of Utility, rewards those using or adding capacity to the network and reduces the volatility of resource costs over time.
Since the WBI Token represents “Ownership of resource”, when we distribute WBI from the System Inflation, we are making a Distribution of Resource to;
Stakeholders who are using resource; or
Stakeholders who are facilitating Utility
Importantly, those not contributing to Utility receive nothing from the System Inflation.
The Resource Distribution via the WBI System Inflation is essentially a reallocation of Resource; from those not contributing to Utility to those that are.
The WBI Token currently has a System Inflation rate of 6% annualized (N.B. hereafter are expressed on an annualized basis). WBI holders are eligible for 4% with the balance distributed to Block Producers and the Worbli Network fund.
For now, we concern ourselves with the 4% distribution (since the balance is for the benefit of all WBI holders and can be considered a “Wash”).
WBI holders can
Stake to access the network resources, for example in order to run applications.
“Lock” tokens to lend their resources.
Оr simply do nothing and maintain liquidity.
RESOURCE DISTRIBUTION FOR RESOURCE USAGE FROM SYSTEM INFLATION
WBI that are staked for Utility receive the System Inflation Resource Distribution, minus the Resource Distribution for Locking and are capped at a 12% Yield.
For example, if 25% of WBI were staked for Utility and there were no Locked tokens, the unconstrained yield would be calculated as (4% / 25% = 16%) and therefore, the yield would be limited to 12%.
As WBI are Locked, the Locking fees are deducted from the 4% distribution thus reducing the Yield on Utility. Utility yield varies with the number of Locked WBI.
We constrain the yield on Utility to avoid inflation and devaluation of the WBI token. WBI that are not distributed due to the cap are “Burnt” in order to manage the WBI supply in a low Utility environment.
N.B. Before applications can stake WBI for their resource allocation, they have to be permissioned by the WORBLI FOUNDATION. This is to ensure that the quality and performance of the application is appropriate for the network, its customers and its users. This assists in the optimization of network resources and ensures applications themselves are resource-efficient.
RESOURCE DISTRIBUTIONS FOR “LOCKING” FROM SYSTEM INFLATION
For those WBI holders not using their resource allocation, they are able to lend back to the network via our internal Resource Exchange.
The current requirement is that WBI holders Lock for a period of 4 weeks in order to receive a Resource Distribution. The Locking pool provides dailyresource liquidity for Resource leasing.
For simply Locking their tokens for the defined period and irrespective of whether they are actually leased, Locked WBI receive a Resource Distribution from System Inflation whilst Utility is greater than zero.
Importantly Lease payments themselves on the Resource Exchange are additional fees for Locked WBI. These are payments from resource lessors to lessees for the cumulative daily leases executed. They are outside of System Inflation and not a system distribution.
Locking Resource Yields from System Inflation are paid from a curve that is dependent on the daily system Utility measurement. It is designed to maximize Resource Distributions for Locking when Locking is most valuable to the system.
Locking yields are fixed from the curve irrespective of the number of other tokens Locked.
If WBI are removed from Locking prior to their expiry of the 4-week period, they forfeit the right to their Resource Distribution, and this is reallocated proportionately to the surviving Locking pool. The Resource Distribution is accrued daily and distributed at the conclusion of the 4-week period.
INTERNAL RESOURCE EXCHANGE
Locked WBI reside in a pool here as liquidity for daily resource leasing. As applications experience a short-term requirement for resource, they are able to seamlessly draw on the pool on a daily rollover basis.
Daily fees are collected from Resource lessees for the Locked pool and released to eligible Locked tokens at the end of the requisite 4-week Locking period.
This protocol is outside of the System Inflation and consists of Lease payments collected and released proportionately to Locked tokens.
The leasing rates are determined as a function of the current Utility yield derived from the System Inflation calculations. In other words, the cost to lease a token is equivalent to the yield currently paid for Utility.
RESOURCE FLOW CHART
EXAMPLES OF SYSTEM INFLATION DISTRIBUTIONS
Locking Resource Yields are fixed as a function of Utility irrespective of quantity of Locked WBI.
However, Utility Resource Yields are inversely related to quantity of Locked WBI.
(1) Utility at 10% and Locking at 10%
- Utility Resource Yield capped at 12%
- Locking Resource Yield is 2.5%.
This Resource Distribution creates a 1.45% System Inflation leaving 2.55% to be burnt.
Locking Yield is low since there is a structurally low system requirement for resource.
However, since potential leasing income from the Resource Exchange are equivalent to the Utility Resource Yield, potential income available to Locking is high at 12%. In low Utility this would normally steer users towards buying WBI as opposed to leasing all other things being equal.
(2) Utility at 50% and Locking at 50%
- Utility Resource Yield: 4.2%
- Locking Resource Yield: 3.8%
With the system “Full” in that all tokens are designated for Utility, we can see that an equilibrium pricing for resource has been achieved.
EFFECT OF LEASING ON LOCKED TOKENS
The above examples are the Resource Distribution of System Inflation. Should leasing occur, the Locked tokens receive lease fees in addition. If we take the following scenario from the tables above:
The Leasing Fee is derived from the Utility Yield that is 8.7%
If we now assume that a further 10% of WBI are Leased from the Locking Pool, Locked WBI yield can be seen as:
Where the ratio of Leased WBI to Locked WBI determines the Lease fee per Locked WBI.
SUMMARY OF RESOURCE ECONOMY
WORBLI cares about maximizing utilization of the network. The Resource framework has been constructed to promote optimal use of resources in order to advance Utility.
In order to achieve resource pricing stability, we have established an elastic economic model that considers the Utility purpose of the token, the drivers and factors of stability in various system states and alignment of stakeholders in the network.
The Resource Economy drives network Utility which is the WORBLI key determinant for success.
All Intellectual property rights in this code were created by and are the sole property of 0rigin Ventures. All rights are hereby reserved. This code is produced herein pursuant to an irrevocable, non-sublicensable, royalty-free license from 0rigin Ventures to WORBLI. No third party may copy, use or otherwise exploit this code except pursuant to a duly issued license from 0rigin Ventures. Please contact either 0rigin Ventures or WORBLI for more details.
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This release is published solely for informational purposes and has no regard to the specific objectives, financial situation or particular needs of any person. Information contained herein is believed to be reliable but no warranty is given as to its accuracy or completeness and views and opinions are subject to change without notice.
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