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Introduction

BLOCK is the utility token that powers the Blocknet Protocol. Fees are paid in BLOCK when using the network and 100% of those fees are distributed to Service Nodes for supporting the network and infrastructure. Normal transaction fees on the network are also paid in BLOCK, but those fees are burned. If seeking to acquire BLOCK, there are various options available.


Specifications

BLOCK Details
Creation Date October 20th, 2014
Release Method ITO, No Premine
Proof Type Proof of Work (PoW): blocks 0-2000 (ended)
Proof of Stake (PoS): blocks 2001+ (current)
Algo Quark
Block Time 60 seconds
Block Reward 1.0 BLOCK
0.3 awarded to stakers
0.7 awarded to Service Nodes
Superblock Up to 40,000 BLOCK
Difficulty Adjusted per block
Staking Requirement No minimum
Service Node Requirement 5000 BLOCK
Circulation View here
Max Supply No maximum supply (PoS), but there is a maximum to inflation
Circulation Lockup Average lockup is ~45% due to Service Node collateral
Average lockup is ~60% when also considering staked funds

Scaling

The Blocknet Protocol is fast and the capacity of the protocol increases with its user base. Since order broadcast and order matching are completely decentralized, there are no bottlenecks other than the ones which lie with users, namely their local internet connections. In addition though, there is a shared capacity in the broadcasting system, which is extremely high. Here is a relevant quotation from a Bitcoin wiki:

Bitcoin Wiki

Let's assume an average rate of 2000tps, so just VISA. Transactions vary in size from about 0.2 kilobytes to over 1 kilobyte, but it's averaging half a kilobyte today.

That means that you need to keep up with around 8 megabits/second of transaction data (2000tps * 512 bytes) / 1024 bytes in a kilobyte / 1024 kilobytes in a megabyte = 0.97 megabytes per second * 8 = 7.8 megabits/second.

This sort of bandwidth is already common for even residential connections today, and is certainly at the low end of what colocation providers would expect to provide you with.

When blocks are solved, the current protocol will send the transactions again, even if a peer has already seen it at broadcast time. Fixing this to make blocks just list of hashes would resolve the issue and make the bandwidth needed for block broadcast negligible. So whilst this optimization isn't fully implemented today, we do not consider block transmission bandwidth here.


Inflation

While there is no maximum limit due to the blockchain being Proof of Stake, there is a limit to the amount that can be minted per period (limited inflation). This means that over time the inflation rate decreases as the circulation increases and the amount of BLOCK minted remains constant. Below are 2 sets of data that demonstrate this.

Lower Bound of Inflation

In this first set of data, the inflation rate displayed takes into account just block rewards. The below data represents the minimum inflation possible.

View data

Upper Bound of Inflation

In this second set of data, the inflation rate displayed takes into account both block rewards and the maximum Superblocks amount. It's important to note that the Superblock does not need to mint the full 40,000 BLOCK so in reality the inflation will likely never reach these levels. The below data represents the maximum inflation possible.

View data