S Token
Last updated
Last updated
The S token is the native token of Sonic. It has multiple roles within the network, such as paying for transaction fees, staking, , and participating in governance.
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You can stake S on Sonic on . Staking your S involves a 14-day waiting period if you choose to withdraw.
When staking your S, choose a reputable validator carefully. If your validator is penalized for misconduct or errors in their setup, it could impact your delegated S stake as well.
At Sonic’s launch, the total supply of S is 3.175 billion. As decided by multiple governance proposals, the additions below will gradually be implemented into the tokenomics of the S token.
An additional 6% of the 3.175 billion S will be minted six months after Sonic launches exclusively used forthe , rewarding both Fantom Opera and Sonic users and builders. The airdrop features an that rewards active participation and gradually reduces the total supply of S tokens.
Six months after Sonic launches, the network will to:
Increase S adoption and global presence
Grow the team and scale operations to drive increased adoption
Implement robust marketing initiatives and DeFi onboarding campaigns
To fund this program, an additional 1.5% of S (47,625,000 tokens) will be minted annually for six years, starting six months after the mainnet launch.
However, to guard against inflation, the network will burn newly minted tokens not used during the year, ensuring that 100% of all newly minted tokens from this initiative are allocated toward network growth rather than being held by the treasury for later use.
For example, if Sonic Labs uses only 5,000,000 tokens in the first year, the network will burn the remaining 42,625,000 tokens.
To achieve a 3.5% APR for Sonic without causing further inflation in the first four years, we're reallocating the remaining FTM block rewards from Opera to Sonic. These rewards are technically part of the initial 3.175 billion S supply, but the circulating supply at launch will be ~2.88 billion tokens. The annual difference of 70 million tokens will be distributed as validator rewards over the first four years, avoiding the need to mint new S tokens during this period for block rewards.
As a result, Opera's APR dropped to zero upon Sonic's launch. To preserve value and avoid new inflationary rewards at Sonic's inception, we will not mint new tokens for block rewards during the initial four years, as stated. After that period, S block rewards will resume by minting new tokens at a rate of 1.75% per year to reward validators.
We have two burn mechanisms in place that will decrease the emission of new S tokens.
To help secure the Sonic network by running a validator and staking a certain amount of S, you can earn block rewards as well as transaction fees paid by users on Sonic.
The reward rate adjusts proportionally, e.g. if all S tokens are staked, the annual reward is 1.75%. Conversely, if only 25% of S tokens are staked, the annual reward is 7%.
We are from Fantom Opera to Sonic. As validators and stakers move to Sonic, Opera's block rewards will be reduced to zero, and the saved funds will be used to reward Sonic validators. The Sonic Foundation will maintain Opera validators for now.
The target reward rate for validators on Sonic is 3.5% when 50% of the network is staked. The network mints tokens each epoch to provide this, except during Sonic's first four years when rewards stem from block rewards migrated from Opera, .
Network fees are generated when users pay gas to interact with the network. Validators earn a percentage of these fees, which are distributed equally among all staked S tokens. For a detailed breakdown of how much a validator earns from gas fees, .
Users who choose not to wait for the full 270-day maturation period for 75% of their airdrop will lose a portion of their S tokens, which will be burned.
From the 47,625,000 S tokens minted annually in the first six years of Sonic to fund growth, the network will burn any of the tokens not used during the year.