Autonio is revamping the economic model for its NIOX token to boost efficiency while maximizing rewards for those who help further our vision of building a prosperous community around algorithmic crypto trading.
The new structure is the brainchild of the Autonio team and our new partner 0rigin, a creator of cutting-edge blockchain and decentralized models, backed by a team steeped in both traditional finance and innovative technology (0rigin.one).
Together with 0rigin, we are planning some exciting new additions to the NIOX ecosystem, including AI-driven trading models and a DEX aggregator using the UX Network trustless bridge technology.
We have sketched out the basics of our new NIOX token model below. If you want to dig deeper, please click here for more detailed documentation.
What is NIOX?
NIOX is the native governance and reward token of the Autonio (Automated Nexus of Intelligent Operations) Foundation, a project founded in 2017 with the ambition of creating robust and innovative tools to help investors conquer crypto markets.
NIOX plays a central part in Autonio’s product Suite—a range of interfaces and tools that offer traders access to centralized and decentralized liquidity pools and proprietary algorithms. These include:
- Maker – An easy-to-use algo-trading terminal with an intuitive interface. Through it, users can access the latest High Frequency Trading (HFT) methods or choose from a selection of market maker bots to match various strategies.
- Swarm – A liquidity mining protocol that takes a marketplace-based approach to market maker compensation, leading to high matching efficiency.
- Smartdex – A decentralized exchange (DEX) that offers secure peer-to-peer transactions via an orderbook and swap interface. Designed as a multichain DEX, Smartdex is now live on Polygon and will launch on Conflux, BSC and Cardano in the coming months.
- IMM – We are in the advanced stages of developing a set of machine-learning trading models that will further enhance the trading performance of our toolset to create Intelligent Market Makers.
How many NIOX are issued?
There are currently 315 million NIOX in circulation. This can increase via system inflation which is capped at 5% per annum.
NIOXonomics: It all starts with trading fees…
People who trade on the Smartdex or deploy Autonio’s trading tools and capabilities pay fees for the service. These range from a base “execution-only” charge up to premium rates for access to more sophisticated functionalities.
Democratic Fee Rates
The base rate ranges from 5 basis points to zero, depending on how much of the total NIOX float is committed—or staked—to Autonio’s decentralized autonomous organization (DAO).
The rate is determined at any given time by the product of the maximum rate (5 basis points) and the amount of NIOX that are not staked. The maximum rate would be applied if there were zero NIOX staked to the DAO and the minimum rate at 100% staking.
If 60% of all NIOX tokens in circulation are staked to the DAO, for example, the base trading fee would be set at 2 basis points (40% x 5)
Fee payments are converted into NIOX and routed to the system fee pool.
The rewards for liquidity provision
Users who provide liquidity via NIOX Swarm or liquidity farming earn a flat fee of 30 basis points (0.3%) less the base trading fee at the time.
For instance, a user who provides liquidity when the prevailing base fee is 2 basis points will receive a net payment of 28 basis points.
The deducted execution fee flows into the system fee pool.
The proportion of fees burnt is determined by the amount of NIOX that are not staked to the DAO. For example, if 60% of NIOX are staked, 40% of fees are burnt.
NIOX has a natural system inflation that maximises at 5% per annum. The rate itself is also determined by the amount of NIOX Staked and follows a log curve ( see examples in the table below):
NIOX token supply may increase or decrease depending on the system state. For example, high transactions and low staking may deflate the token supply.
Total Rewards for Distribution
Inflation is added to net NIOX fees and allocated as follows:
- Rewards for membership in Autonio’s decentralized autonomous organization (DAO)
- Allocations to the NIOX Fund. This provides support for projects that will further the successful realization of Autonio’s strategy and vision.
Now we come to the role of staking.
Any user can join the Autonio DAO by staking a minimum amount of NIOX to the project. In addition to a voice in governance and plans, membership offers fee-free trading on the Smartdex and rewards from the system fee pool.
80% of rewards (post burn) are allocated for DAO members
Members who make longer commitments—up to two years—are compensated for their loyalty through bigger reward payouts. The total each member receives is determined by the size of the stake adjusted by a square root of time factor.
Practically speaking, a DAO member who has staked a token for twice as long as another will earn the square root of 2 times (approx. 1.41) as much as the member with the shorter commitment..
The Final distribution from the system pool: The NIOX Fund
The residual 20% of rewards goes to the NIOX Fund for project-enhancing investments, which we will discuss further in future publications.
The Trading Fee and NIOX Relationship
Trading fees are inversely proportional to the number of NIOX tokens staked to the project. This makes staking an attractive prospect for active investors on the platform who want to benefit from lower transaction costs.
More generally, the democratic approach to resolving fee levels allows the system to maximise its total income. Simply put, if fees are too high, volume will be lower than expected, and if fees are too low, income will be lower than expected.
That’s the new model in a nutshell—one that allows for the seamless interplay between staking and liquidity throughout changes in volumes and profitability.
Perhaps most importantly, Autonio’s NIOX becomes part of a system designed to accurately reflect and contribute to the economic health of the platform and its long-term success.