Virtual Mining

You can create your own supply of Lotus by creating miners.

Virtual mining is the primary way to acquire Lotus tokens, using $TitanX as the mining resource. The mining process is structured to reward longer mining durations with higher returns in Lotus tokens.

Mining Details:

Mining Durations: Users can mine Lotus for periods ranging from a min of 1 day to a max of 180 days in 2 different ways.

1. Single Miner: An individual user participating in virtual mining, using TitanX to mine Lotus tokens over a chosen time frame with an option of 1 to 100 power(cost) per miner.

2. Batch of Miners: A group of individual mining instances, running concurrently or with durations to maximize mining efficiency and potentially reduce Gwei when claiming the minted batches upon maturity.

Longer Mining Bonus: The protocol incentivizes longer mining periods by offering a "bonus" in Lotus tokens to those who mine for extended durations, this bonus is know as the "L-Rank". The bonus sectionally scales with the length of the mining period, encouraging users to commit their Lotus for longer durations to maximize their rewards.

To avoid being too top-heavy but still attractive to early users, the L-Rank starts with moderate, increasing rewards based on duration. This option encourages an aggressive approach, providing greater rewards for longer miners while maintaining a balanced increase to avoid early burnout.

L-Rank Mining Bonus Scale

• 0–30 days: +3%

• 31–60 days: +8%

• 61–120 days: +13%

• 121–180 days: +18%

Why does the L-Rank Bonus for Mining Scale in 4 Sections unlike the Structure of the Staking Bonus that Scales per Day?

Answer:

• Hyper-Deflation Misalignment: Scaling bonuses for miners would contradict the hyper-deflationary goals by increasing token emissions, thereby diluting the scarcity the protocol is designed to maintain.

• Inflationary Pressure: A scaling system would lead to more tokens entering circulation, increasing supply and potentially devaluing the token in the long term.

• Imbalance in Participation: Rewarding higher L-rank miners disproportionately would discourage smaller miners, leading to centralization and reducing the ecosystem's decentralization Ethos.

• Sustainability Risk: Scaling bonuses could exhaust the mining reward pools faster, harming the longevity of the protocol's incentive mechanisms.

The mining bonus scaling is designed to reward users who commit to longer mining durations. The highest bonus of +18% for 121–180 days helps lock in token supply for an extended period, reducing the circulating supply during the crucial early phase of the protocol.

Since the supply of Lotus is Deflationary due to daily minting reductions daily, daily mining cost increases and additional burning mechanisms, it’s critical to incentivize users to participate in long-term mining. The gradual increase in rewards (from +3% to +18%) ensures that tokens are locked up in mining for longer periods, helping to manage the circulating supply and driving value appreciation over time.

By offering lower bonuses for shorter durations (e.g., +3% for 0–30 days and +8% for 31–60 days), the system encourages a range of mining behavior. Some users may opt for short-term mining, while others commit to long-term mining to maximize bonuses.

- This balance is crucial in maintaining engagement across different types of participants while allowing the protocol to scale efficiently.

Hyper Deflation Approach

Starting Day 1 of Protocol:

• Maximum Tokens a Single Miner Can Mint on the First Day: 150,000 Lotus per max miner. Tokens decrease in each miner relative to the miner power. Miner Power can be set from 1 to 100.

• Daily Decrease of Tokens Available per Max Miner: 2.25% per day after day 1 of protocol

• Daily Max Miner Cost Increases: 1.75% per day Increase in TitanX per Miner after day 1 of protocol

By increasing the daily minting cost at a slightly faster rate, it compensates for the increased initial liquidity, which could create a higher initial token value. The faster mint cost escalation also discourages users from relying on lower-cost minting for too long and increases the deflationary pressure, helping to maintain scarcity.

Key Considerations:

1. Aligning with Deflationary Pressures:

   Since the daily minting decreases by 2.25%, this bonus structure provides a balanced incentive without overly inflating the token supply. The highest bonus (18%) is reserved for the longest commitment (121–180 days), which helps lock up tokens during the period of greatest deflationary pressure.

2. Encouraging Longer Mining:

   The increasing bonus tiers encourage users to commit for longer mining durations, which aligns with the deflationary model. With the mint cost increasing by 1.75% in TitanX daily, longer mining periods become more attractive as users can maximize token return before minting costs become prohibitive.

3. Strength: The L-Rank bonus scaling remains competitive by offering significant rewards for those who commit to longer miners, while not front-loading too much value in the shorter duration miners. This balance prevents early burnout and encourages sustained engagement with the protocol.