The tokenomics of XEL

XEL is a token that is created in the process of minting, and it’s strictly connected to the XEN Crypto minting through our wallet manager tool. The XEN token is a reward given to all those who mint XEL. XEL is disinflationary, decentralized, and follows the XEN ethos of maximum adoption by creating the lowest barrier to entry for new users. It’s fair crypto with fair distribution.

What is XEL

XEN is a byproduct of XEL because it’s minted only if XEN is minted through the XEL wallet manager and its underlying contract. XEL is created in a similar fashion to XEN Crypto, in the sense that it starts at supply zero and is not pre-minted by the founders or anyone else. Its supply is disinflationary, which means that the rate of inflation at which the XEL is created is constantly decreasing.

It’s designed to be extremely scarce, and this happens because of the 5% weekly reducing reward multiplier. Its supply will never be diluted by contracts launched on other chains because XEL will exist only on Ethereum as a Certik-audited, immutable contract with no admin keys. This ensures that both XEN and XEL work together as a unified force where one enhances the other.

How is XEL created

The XEN mint is what determines the quantity of XEL you’re entitled to. When you mint XEL through the XEL wallet manager, a multiplier is applied to your XEN mint. A mint term of at least 50 days is required. This acts as a deterrent for short-term minters to profit from excessive speculation and token inflation. The multiplier is reduced by 5% each week, so the user will get the highest number of XEL when he mints as early as possible because the multiplier is constantly dropping. What’s more, the maximum amount of XEL (approximately 2x) can be created only if the user mints for the maximum available mint term, which is tied to the XEN smart contract. As a result, the users who come to the protocol later rather than earlier will never get the same amount of tokens as those who minted before them. The protocol rewards those who took the most risk.

XEL mint calculations

There are two factors influencing the number of XEL you will receive:

  • The amount of your XEN mint
  • The number of days in the mint term

In the table below, you see multipliers for each week starting from the date of the launch of the XEL smart contract. When you calculate XEL, you need to add up each weekly multiplier for all of the complete weeks of your mint term. This means that your multiplier increases the longer is your XEN mint term. 

First, you need to find the number of weeks you’re minting for:

 

N° of weeks = XEN mint term / 7 days 

 

To know your multiplier, you need to add up all of the complete weeks you’re minting for. 

 

XEL Multiplier = week multiplier + week multiplier + … 

 

XEL = Total XEN mint * XEL multiplier

 

For example

Example 1 – Short term mint – Early start

In this scenario, we analyze the amount of XEL we can get if we start to mint, getting into XEL early but for the minimum mint term.

The user mints XEN with a mint term = 50 days. He starts minting during the third week after the genesis of XEL, so if we divide 50 days by 7 weeks, we get 7 full weeks.

50 / 7 = 7 full weeks

If we now look at the multiplier table, we’ll see that the multiplier starting at the third week and continuing through all seven weeks up until the ninth week gives a total of  0.56. This is our multiplier that will be applied to our XEN mint. According to the formula, we get this amount of XEL:

Total XEN mint for approx 3,500,000 * 0.56 XEL multiplier =  1,960,000  XEL mint

XEL declining multiplier

Example 2 – Medium term mint – Early start

In this scenario, we start minting early in the first week right after the launch, but our mint has a medium length mint term.

User mints for 140 days starting week 1 which equals 20 weeks: 

140 / 7 = 20 full weeks 

We sum up all of the multipliers from the table starting at week 1 through to week 20 and we get in total a XEL multiplier = 1.32X.

Total XEN mint approx 10,000,000 * 1.32 XEL multiplier =  13,200,000  XEL mint

Being early and minting longer definitely gives more XEL.


xel multiplier
XEN weekly multiplier

Example 3 – long mint – Early start

In this example, we come early and mint for the maximum available XEN mint term.

User mints for 406 days starting week 1:

406 / 7 = 58 full weeks

Summing up all the multipliers from every week up to 58 weeks gives us the XEL multiplier = 1.95X.

 Total XEN mint approx 29,000,000 * 1.95 XEL multiplier =  56,550,000  XEL mint

 

XEN logo

 

Example 4 – long mint – Start late

In this example, we come in late after the launch of XEL, and all the best starting mints already dropped a lot. Remember that each week the multiplier drops by 5% to infinity. We choose to mint for the max available XEN mint term.

User mints for 406 starting week 60:

406/7 = 58 full weeks

Summing up all the multipliers from week 60 up to week 118 gives us the XEL multiplier = 0.09X.

Total XEN mint approx 21,000,000 * 0.09 XEL multiplier =  1,995,000  XEL mint

 

 

XEL weekly multiplier

 

 

Example 4 – long mint – Start late

In this example, we come in late after the launch of XEL, and all the best starting mints already dropped a lot. Remember that each week the multiplier drops by 5% to infinity. We choose to mint for the max available XEN mint term.

User mints for 406 starting week 60:

406/7 = 58 full weeks

Summing up all the multipliers from week 60 up to week 118 gives us the XEL multiplier = 0.09X.

Total XEN mint approx 21,000,000 * 0.09 XEL multiplier =  1,995,000  XEL mint

 

It’s easy to see that getting started early and minting for as long as possible gives the most XEL. This kind of tokenomic tied strictly to the disinflationary aspect of XEN as well as disinflationary aspect of XEL creates a scenario where the scarcity of XEL will positively influence XEN. 

xel multiplier
XEL weekly multiplier