The Future of Social DeFi.
Star Network is a social network with payment function for users to
store, grow and transfer your Star balance with your peers.
It is also the future’s decentralized finance platform with
exchange, borrowing & lending, wallet & payment functions
1 Origins of cryptocurrencies
Technically cryptocurrencies started with the launch of Bitcoin (BTC) in 2009. Today, there are over 4000 cryptocurrencies published in today ‘s world and more than 100 cryptocurrencies have a market cap over $1 billion. Although there is significant development in the entire cryptocurrency habitat throughout the decade, it has only caught the general public ‘s attention worldwide since mid 2020. Between April 2020 to April 2021, Bitcoin price soared 1,100% YoY and public figures like Elon Musk openly endorsed the investment value of Bitcoin and other major cryptocurrencies.
While the underlying principles and technology of cryptocurrencies remain sophisticated, the openness of the general public’s acceptance in embracing the investment value and practical application of cryptocurrencies has underpinned the future success of the entire cryptocurrency ecosystem.
1.2 How cryptocurrencies make the world a better place
Anyone who was born in or before the 1980s would not forget the aftermath of the fall of Lehman Brothers — millions of jobs lost, trillions of wealth evaporated and more importantly, the American dream shattered.
What’s more unforgettable is that, while the majority of the general public in the modern economy suffered from the Global Financial Crisis, the majority of the crisis’ creators, largest banks in the US, were bailed out by the US government and ultimately taxpayers because they are “too big to fail”.
12 years down the row since the Global Financial Crisis, major banks survive and remain profitable. By the time of writing, the largest bank in the US, JPMorgan Chase & Co., has a market capitalization of $492 billion. How could a bank make that much money? While the business model of banks continually evolves, the fundamental principle is that they make money out of your hardly earned money.
You don’t want to put your savings in a safe so that you deposit your money into your savings accounts with banks. While the bank pays you minimal interest, they lend your money to 3rd parties or invest in assets which yield much higher interest rates or return on investment, as simple as that, but you could not share a slice of the profit they make out of your capital.
You want to transfer money to a 3rd party. If you don’t want to meet him face to face and pass him a big bag of cash, you would do so by making a transfer from your bank account to the 3rd parties’ bank account. Transaction fee, remittance fee, service charges, the banks could have a bucket of reasons to reduce your eligible balance, although the original amount remains in the bank after the transfer and the bank can continue to make profits by lending or investing other people’s money.
Consider another scenario. Today you are in your bank’s retail branch and would like to withdraw 100 million dollars in cash, or transfer the amount to a 3rd party ‘s account with another bank, what would your Relationship Manager ask? We know it would not be a no-question-asked scenario, even though you are moving your own money. In the worst case scenario, the bank could accuse you of money laundering, refuse your request in cash withdrawal or 3rd-party transfer, they could even freeze your account and literally seize your assets.
Why would we let our wealth be ripped off by banks? Traditional wisdom makes us believe that we will need an authorized party as an intermediary to validate and bookkeep financial transactions. The traditional business model has made banks the centre and puts them at a supreme position to make money out of your capital and control the capital flow.
The decentralized, anonymous and irreversible nature of blockchain technology and cryptocurrencies are solutions to extreme reliance of financial transactions on intermediaries like banks. Cryptocurrencies allow all users in the “chain” to record and maintain all peer-to-peer transactions on a collective basis. As all transaction records are kept by all users in the “chain”, there is no risk of any single party being able to manipulate the record and make any changes without updating all parties. Hence, users within the “chain” can directly do secure financial transactions with each other without the presence of an authorized intermediary like a bank. You may refer to section 3. Consensus Protocol for technical details.
“Banking is necessary, banks are not.” Bill Gates has once said this in 1994. The blockchain technology advancement has made this truly happening now.
1.3 What other problems arisen from current cryptocurrencies
Bitcoin, as the world’s first and ever cryptocurrency, is indeed a good innovation. It completely solves the problem of lack of trust in any peer-to-peer transactions without the presence of an authorized intermediary. The only problem is that there are too few people in the world who could genuinely enjoy the benefit brought by Bitcoin. The computational power required to earn a Bitcoin has increased drastically over the last decade which makes Bitcoin a game only for professionals instead of the general public. You can find a more detailed discussion in section 2.1.1.
A new problem often leads to a new solution, if not another problem. Bitcoin, together with other first-generation mainstream cryptocurrencies, have tackled the problem of heavy reliance on intermediaries for financial transactions, but it has brought a new problem of high energy wastage and extreme inequality in coin distribution.
As time evolves, there are several second-generation cryptocurrencies launched in response to the problems brought by Bitcoin and other first-generation cryptocurrencies. These new cryptos promote the idea of cryptocurrency liberation & democratization which the vast majority could easily earn these new cryptos, usually without heavy waste of energy.
These 2nd-generation cryptocurrencies have much lowered the entry barrier and successfully educated the mass population on crypto fundamentals. However, these have led to new problems of people gaining fraudulent benefits unethically by creating several new accounts by fake identity. When the entry barrier is that low, without a proper compliance process the entire crypto network can be brought to a breakdown as it violates the principle that any blockchain network would honor — the trust. Detailed discussion can be found in section 2.2.1.
There comes Star Network, a new solution to all problems we addressed above.
1.4 What is Star Network
Star Network is a social DeFi (Decentralized Finance) network with the core objective to rebuild the financial world in a decentralised way by social power. It’s an invitation-only platform. It lets users grow their balance of Star as a reward for inviting their trusted people to join the network. Star is a new form of digital currency. It also serves the function of social communication and peer-to-peer transactions between users. When the project develops and evolves, Star Network will develop its own blockchain main net for Star and list Star on major exchanges, also offer further decentralized finance solutions like decentralized financing, wallet & payment, crypto exchange and furthermore. It is missioned to be one of the world’s largest one-stop decentralized financial platforms.
Star Network capitalizes on democratizing the earning of cryptocurrency and the use of blockchain technology to everyday people, while mainstream cryptocurrency network like Bitcoin Network has set entry barrier too high that only a handful of professionals with in-depth knowledge and abundant resources can stand a chance in to earn a new coin.
Star Network enables users to earn Star easily through our app, this is contradictory to the huge energy wastage incurred by supercomputers when earning Bitcoin. Star Network also recognizes user contribution to the build-up and development of the network in which users will be rewarded with extra Star balance when users have invited new joiners to join the network.
Security, fairness and preservation of Star’s future value are of our highest priority. While there are several networks in the market that adopt a similar approach, Star Network is specifically designed to fill in the market gap and address the common issues of lack of security, fairness frauded by robots and supply far exceeds demand.
Star Network will start rolling out Know Your Customer (KYC) verification process on selected users in the project’s very early stage to tackle security issues.
To understand the uniqueness of Star Network, firstly you need to learn the definition of Nominal Balance, Convertible Balance, Libra and Realized Balance.
Nominal Balance means your Star balance on paper, this is the sum of Star balance that you have earned from the contribution made by both KYC-ed user and non-KYC-ed users (including yourself if you have not passed KYC yet and all users who have joined your team but have not passed KYC yet.) Nominal Balance could not be used yet, but it is an indicator of the maximum balance that could be turned into Convertible Balance, assuming 100% users in your team have passed KYC. It will be deducted every time once Convertible balance has been unlocked into Realized Balance.
Convertible Balance refers to the portion of Star Nominal Balance earned from KYC-ed users. Once you have passed KYC, and your Boosters have passed KYC, the corresponding portion of your Nominal Balance will become Convertible Balance, which can be unlocked into Realized Balance upon the exercise of a Libra (an unlocking token). In other words, it is only the balance earned from yourself (after passing KYC) and your Boosters passing KYC would be Convertible Balance.
Libra is an unlocking token which you can use to 1) get a KYC slot 2) unlock the current Convertible Balance into Realized Balance. In other words, Libra is an important asset necessary for yourself passing KYC and unlock your Convertible Balance into usable balance (i.e. Realized Balance). Libra is an NFT, hence it is a transferable asset with an expiry date of 7 days. Once you have passed KYC successfully, you have the option of using the Libra for yourself or keeping it and transferring to another user.
Realized Balance refers to the actual balance that you can withdraw, transfer or use. Star Network mobile app also serves as the wallet of Stars. Once you have Realized Balance in your wallet, you can initiate peer-to-peer transfer to any other Star wallet holder, regardless of their KYC status, upon the major app update forecasted to be launched in mid-Nov 2021.
There is a chance that some users might attempt to grow their balance unethically by creating a long list of new users by robots and let these fake users join their own team. As these robot accounts can never pass our KYC process, the Nominal Balance earned from inviting robots can never be converted into Realized Balance. This solves the problem of unfair fraudulent earnings.
To preserve the value of Star, while every user will eventually be given a chance to pass KYC, Star Network will only release KYC slots to certain users by phases by regularly releasing a certain number of Libra, the unlocking token, for user drawing. This avoids the potential risk of having all users selling their Realized Balance to the market and thus cause an irreversible plunge on Star’s value.
1.5 Founding team members
Star Network’s core team is formed by professionals in investment banking, technology, and payment network fields. The core team consists of ex-senior executives of investment banks including Goldman Sachs, Morgan Stanley, technology giants including Google, Facebook, Apple and payment networks including Visa, Paypal. As Star Network is missioned to be a global project, our core team members are based in leading financial hubs with mature financial and technological infrastructures including the United States, United Kingdom, Germany, France, Japan, South Korea and Singapore.
Combining the core team’s expertise in investment banking, fintech, social media and compliance, Star Network is dedicated to building the safest and friendliest all-in-one decentralized financial system. Core team members will disclose their identity in the project ‘s later stage when timing matures.
Star Network’s Solutions to Current Pain Points
Star Network’s Solutions to Current Pain Points
2.1.1 Extreme inequality of mainstream cryptocurrency distribution
Capitalism makes the rich richer and the poor poorer, inequality in wealth distribution seems the destined fact among the real-world economy. In fact, distribution of mainstream cryptocurrency seems more uneven than the real-world economy. Take a look in the stats below comparing the global wealth distribution and Bitcoin distribution in 2018.
While 0.8% of the entire adult population possess wealth more than USD 1 million, there is only 0.1% of the total Bitcoin wallet that possess Bitcoin worth USD 1 million, the Bitcoin distribution is 8 times more centralized than global wealth. Take a look in another statistics in 2021,
the top 2.14% of Bitcoin wallets own 94.77% of total Bitcoin circulation.
In the cryptocurrency economy for mainstream cryptos, the wealth distribution is governed by the earlier the richer, the later the poorer, as the system has naturally set an ever-growing entry barrier for late comers. Take Bitcoin as an example, early-stage users can easily earn Bitcoin by their home computer without extreme consumption in electricity, and as time goes by the competition in earning Bitcoin gets fiercer and nowadays one must invest heavily in graphics processing unit (GPU) or application-specific integrated circuit (ASIC) plus vast amount of electricity to stand a chance for earning Bitcoins. The cost of earning per Bitcoin might even exceed the market value of a Bitcoin. That entry barrier literally makes Bitcoin earning out of the game for the majority of the population.
Furthermore, Bitcoin Halving (the act of cutting the reward of earning Bitcoin by half) occurred 3 times in history and there will be more in the future. These all measures further enlarge the disadvantages of later-stage Bitcoin earners and intensify inequality in coin distribution.
2.1.2 Star Network restarts the revolution again for everyone
While the earlier the better is always the rule of thumb in all cryptocurrency ecosystems including Star Network, we strive to give everyone a fair chance to participate.
The entry barrier of participating in Star Network is just a smartphone with internet connection. As opposed to 5-digit USD investment in devices and energy bills, Star Network has opened the door to cryptocurrency earning almost half the world’s population.
Star Network’s referral reward system also gives everyone a fairer chance to grow their Star balance, even though they are late joiners. Star Network users can earn bonus Stars according to the number of active new users that they have invited to Star Network The system rewards users not just by how early they join but also the contributions that they have made to the build-up of Star Network community.
Compared with Bitcoin’s launch date in 2009, the fact that Star Network launches in 2021 has given the vast majority a fairer chance to participate in the system again as the information and knowledge gap is being closed. Back in 2009 when the world’s first cryptocurrency was launched, there was too little information available to the general public about the blockchain innovation and thus only a minority possessed the knowledge and expertise in earning Bitcoin. As the world has embraced cryptocurrency for more than a decade, upon thorough market education cryptocurrency no longer remains mysterious to the general public. For those who have missed the cryptocurrency revolution since 2009 due to the information and knowledge barrier, Star Network offers a second chance for everyone to fairly participate in it and enjoy the fruit.
2.2.1 Lack of censorship against fraudulent beneficiaries among “free” cryptocurrency networks
As the cryptocurrency revolution goes by, in recent years several newly launched cryptocurrency networks have tried to tackle shortcomings of mainstream cryptocurrency networks stated above. There are a handful of relatively stand-out networks who reportedly have recorded users in terms of ten millions. While these referral-based networks promote the value of earning “free” crypto and the more users the merrier, unfortunately they failed to create a fair environment and could not combat users exploiting the system by creating a list of fake accounts by robots and earning the referral bonuses. Because all those established platforms would only do the KYC on the main accounts who earn all the referral bonuses but they do not care about the referral bonuses contributed by those fake accounts, which means even if those robots do not pass KYC, there is no claw-back mechanism.
Normally these cryptocurrency networks would offer extra crypto reward to users proportional to the new users they have referred to the network. Some users take the advantage of generating a long list of new accounts by robotic program (and the cost is usually minimal) and thus earn very significant fraudulent bonuses.
Although these fake accounts can never pass the network’s KYC verification, the fraudulent user taken advantage of this, who earned those referral bonuses is in fact a real person and therefore could successfully pass KYC.
If one day that crypto is really listed on exchange, how would you feel when this fraudulent user is making a fortune by robots easily, while you earn much less but contribute a lot more than him?
2.2.2 Star Network keeps it real and accepts no more robots
Star Network uniquely introduces the idea of Nominal Balance and Realized Balance. For detailed definition you may refer to the description stated in section 1.3 above. In short, Nominal Balance is your Star Balance on paper, Realized Balance is the real Star Balance that you can use, transfer and withdraw.
Referring to the fraudulent case stated above. When a user attempts to grow their balance unethically by creating a long list of new users by robotic program and thus take advantage of referral bonus earning, it is true that this user would have a great amount of Nominal Balance on paper. However, as the robot accounts can never pass our KYC process, the part of Nominal Balance earned from / contributed by the activeness of robots can never be unlocked into Realized Balance, so in this case the user‘s Realized Balance of referral bonus is practically zero other than his own earning.
2.3.1 Incoherence between blockchain economy and economic reality
By the time of writing, the United States remains the largest economy in the world with highest GDP while Luxembourg is the country with highest GDP per capita. Meanwhile, the most expensive Big Mac in the world will cost you $7.29 in Switzerland, and a Big Mac in Switzerland means the average weekly income per capita in an underdeveloped country.
In the real-world economy, you would not expect someone from developed countries and developing countries to enjoy the same purchasing power, living standard and generate the same economic output.
However, one thing they share in common is that smartphones and internet connection are easily accessible to all of them. You would not expect the iPhone 12 Pro Max penetration rate in less developed countries to be very high, but it is not uncommon to see entry-level Android phones everywhere.
Should they be earning the same in the blockchain economy? If it takes literally the same amount of time and effort for people in countries of different economic power to earn a “free” crypto, would that incoherence with the real-world economy lead to the collapse of that corresponding blockchain economy?
2.3.2 Star Network protects the blockchain economy by prioritizing liquidity in more developed countries
The same rules of individual rate and bonus rate applies to all users of Star Network regardless of their origins. Hence, given the 2 users from countries of different economic power are equally active in making contributions to Star Network, their Nominal Balance would be the same.
What sets Star Network apart from other “free” crypto networks is that we prioritize token liquidity to users according to the national GDP of their home countries. Although everyone will pass through the KYC process in the end, we will firstly release KYC slots to users in countries with stronger economic power. As users can only use, transfer and withdraw Star balance when they have Realized Balance in their wallet, by prioritizing the liquidity, Star Network’s blockchain economy is in sync with the real-world economy and that will give a long term sustainability to the value of Star.
3.1 Blockchain & distributed ledgers
Blockchain is the underpinned technology that builds up cryptocurrency networks. It is a sophisticated concept consisting of cryptography and programming. For educational purposes we will use everyday languages and simple metaphors for simple illustrations below.
Consider blockchain as the same accounting book kept by everyone within a network, contrary to the non-blockchain economy in which an authorized person keeps the book for everyone. Each individual with a computer within this network is named a Node. Whenever there are new transactions made, that entry will be updated simultaneously on everyone’s hand. Hence, there is no need for a centralized authority because the record is kept by and updated for everyone within the network. There is also no way to cheat anyone and reverse that transaction because you can cheat on your own book, but you can’t change the record on the book of all other people within the network. The idea of distributed ledger is the simplest representation of how blockchain works and explains its decentralized, secure and irreversible nature in keeping transaction records.
3.2 Bitcoin & Proof of Work Consensus
Since there are many transactions happening within the network, without a central authority to make final decisions, there is still a need for one Node to verify and approve all transactions happening within a specific time frame, update the book and share with the rest of Nodes within this network. Whenever this regular verification and update is done, a new “block” is formed and connected with previous blocks. That’s why it is named blockchain because it is literally a chain of blocks. Consider the chain as the entire accounting book, and the 1st block means page 1 of the book, the 2nd block as page 2 and so forth.
So which Node in the entire network shall make the final decision of verifying and adding a new block? In the Bitcoin Network, a complicated mathematical problem concerning transaction verification is shared with all Nodes roughly every 10 minutes. All Nodes will contribute their computational power and compete against each other to solve that mathematical problem and thus verify all transactions within this roughly 10-minute period. The fastest Node who solves the problem is the one to post the latest block of transaction, and this Node will be rewarded a certain amount of Bitcoin (it is now 12.5 BTC by the time of writing). The consensus algorithm of having every Node to compete against each other in solving the mathematical problem and verifying all transactions in this block is named Proof of Work.
There is exponential growth in the number of Bitcoin earners as time goes by. However there would only be 1 earner to be awarded with new Bitcoins roughly every 10 minutes. As a result, the complexity of the mathematical problem skyrocketed given the ever increasing level of competition and this sets a very high entry barrier for Bitcoin earners in investing in supercomputers, ASICs, GPUs and energy bills.
3.3 Star Network‘s Modified Consensus Algorithm
Star Network ‘s consensus algorithm uses the voting result of all Nodes to determine the formation of the next block, while Bitcoin Network’s consensus algorithm requires each Node to compete against each other and let the winner decide.
All Nodes in Star Network can make their own transaction verification decision and propose how the next block is formed. They will then internally communicate via network messages and then vote for different proposals. After several rounds of voting, the majority of these Nodes will reach a general consensus and then the voted block will be the next block. Nodes who have contributed to the formation of the next block will be rewarded with Star tokens.
As it is far easier for Nodes to internally communicate and vote via network messages than compete against each other and be the fastest one in solving mathematical complexes, the energy required in earning Star is much less. Also the reward is distributed fairly among Nodes who have made contributions, instead of “winner takes it all” in Bitcoin’s Proof of Work consensus algorithm. Mainstream cryptos like Stellar (XLM) and Ripple (XRP) are also using a similar algorithm and consensus protocol.
4.1 Roles and its corresponding earning
Upon user registration, every user is a Explorer — we all shoot for the Star. Explorer is the fundamental role of Star Network with the basic responsibilities to be an active participant in Star Network.
A Explorer is rewarded with a basic rate of 1.6 Star/hour (or 0.8 / 0.4 / 0.2 upon rate halvings ) for consecutively 24 hours when signed in the Star Network mobile app and clicks the rocket launch button. The earning stops when a 24-hour session is over and will resume when a Explorer has signed in the mobile app again and clicks the button for starting another 24-hour session. Do note that the actual balance will only be transferred to your account upon the completion of a 24-hour session, so in case a Explorer has signed out for whatever reason, he or she will forfeit the earnings of this incomplete session.
Other than being a Explorer, you can invite other users to join your team. Yourself and other teammates are named Booster. Like rocket science, the more Boosters your Explorer is equipped with, the faster you go. Hence, you can boost your own earning rates by having more Boosters in your team.
You are rewarded with an additional 25% of your basic rate for every new user who has joined Star Network by using your referral code. Once these new Explorers have joined Star Network, they are your Boosters. That means an additional 0.4 Star / hour / new active user (or 0.2 / 0.1 / 0.05 upon rate halvings) to your balance. Of course, these bonus rates are only applicable when the Boosters are active and in the midst of their own 24-hour earning session. This means if you have Boosters joining your team but they have not gone online, you will not earn the bonus rate from that inactive Booster.
Booster’s bonus rate is uncapped. This means if you have invited 1,000 new users to join Star Network, and assume that they remain active all time, you will earn an additional 400 / Star / hour (or 200 / 100 / 50 upon rate halvings).
4.2 Nominal Balance vs Convertible Balance vs Realized Balance
The above illustration in 4.1 refers to your earning of Nominal Balance, which means your Star Balance on paper. However, this does not mean the balance of Star that you can use. You can only withdraw, transfer or use your Realized Balance.
To better understand the concept, you will firstly need to understand the definition of the following terms,
Nominal Balance: This is the sum of Star balance that you have earned from the contribution made by KYC-ed users and non-KYC-ed users (including yourself as Explorer if you have not passed KYC yet and all users who have joined your team but have not passed KYC yet.). Nominal Balance could not be used yet, but it is an indicator of the maximum balance that could be turned into Convertible Balance, assuming 100% users in your team have passed KYC. It will be deducted every time once Convertible balance has been unlocked into Realized Balance.
Convertible Balance: This is your Star balance eligible to be unlocked into Realized Balance. Not all of your Nominal Balance could be converted to Realized Balance. It is only the portion earned from KYC-ed users (i.e. yourself as KYC-ed Explorer and KYC-ed Boosters are eligible to be unlocked.) Portions earned from non-KYC-ed Boosters will only grow your Nominal Balance, but not Convertible Balance. It’s the indicator that if you exercise Libra at that point of time, how much Nominal Balance could be converted into Realised Balance.
Libra: This is the unlocking token required for 1) unlocking a KYC slot 2) unlocking your Convertible Balance into Realized Balance. Firstly, when you exercise Libra, you can unlock a KYC slot so that you are able to submit the required information to a third-party KYC compliance company for verification purposes. Also whenever you exercise a Libra, all of your Convertible Balance at the moment will be unlocked into Realized Balance. After each conversion, your Convertible Balance will become 0, and your Nominal Balance will be deducted by the amount of Convertible Balance but then your Convertible Balance will grow again as you continue earning as Explorer (yourself) and from KYC-ed Boosters. If you would like to make another conversion of your newly earned Convertible Balance, you will need to exercise another Libra. Libra is an NFT, hence it is a transferable asset with an expiry date of 7 days. If you are a Libra holder, once you have passed KYC successfully, you have the option of using the Libra for yourself or keeping it and transferring to another user.
Realized Balance is the amount of Star that you can withdraw, transfer or use. Everyone’s Realized Balance wallet status is active (your Star Network mobile app also serves as wallet) regardless of KYC status. Once you have Realized Balance in your wallet, you can do peer-to-peer transfer with any other Star wallet holders, even though they have not passed KYC yet.
You can summarize the earning and conversion process like this,
1. You (before passing KYC) and both your KYC-ed and non-KYC-ed Boosters clicking the rocket button = Nominal Balance grows
2. You have exercised 1 Libra = Got a slot for KYC + all of your Convertible Balance as of now are unlocked into Realized Balance. The Nominal Balance will be deducted by the amount of Convertible Balance.
3. After exercising Libra, You and your Boosters continue clicking the rocket button = Nominal Balance grows from the new balance and Convertible Balance (The contribution made from yourself and KYC-ed Booster) grows from 0 again.
4. Later you have exercised another Libra = All of your Convertible Balance as of that point of time are unlocked into Realized Balance again.
You may find here a more detailed illustration.
Assume you (before KYC) have a Nominal Balance of 10,000 Star. 6,000 is earned by yourself being the Explorer. You have earned 1,500 from Booster A, 1,000 from Booster B, and 500 each from Booster C, D & E and all Booster ABCDE have not passed KYC.
Before you pass KYC, your Nominal Balance is 10,000 Star while Convertible Balance is 6000 Star (assuming you would pass KYC successfully). Realized Balance is 0 Star.
Once you have passed KYC, your Nominal Balance remains as 10,000 while Convertible Balance remains 6,000. Realized Balance is 0.
Once A has also passed KYC, your Nominal Balance remains as 10,000 while Convertible Balance becomes 7,500. Realized Balance is 0.
When all Booster A,B,C,D,E have all passed KYC, your Nominal Balance will be the same as the Convertible Balance of 10,000 Star in this case. Realized Balance is 0 Star.
You have now exercised 1 Libra. Your Nominal Balance is deducted by Convertible Balance. Your Convertible Balance becomes 0 as you have unlocked all of them to Realized Balance. Your Realized Balance is now 10,000 and you can withdraw, transfer or use this 10,000 Star.
Assume there are no new Boosters joining your team, as time goes by you have earned another 10,000 Stars from Explorer earning and Booster earning. Your Nominal Balance becomes 10,000, your Convertible Balance is also 10,000 (because all users in your team have passed KYC) , your Realized Balance is 10,000. (because you have unlocked the first 10,000 Convertible balance to Realized Balance.)
When you have exercised another Libra, your Nominal Balance becomes 0, your Convertible Balance becomes 0, and your Realized Balance is now 20,000 assuming you didn’t transfer away any Star Token.
4.3 Rate Halving Road Map
Rate halving is the act of cutting the supply rate by 50% when a certain milestone is reached. This is an important economic measure to sustain the value growth of Star by scarcity. This also suits Star Network’s philosophy of rewarding earlier joiners with higher supply rate yet without being too extreme.
Star Network will execute 3 times of rate halving when the user base has grown to 500k, 2 million, 10 million. New supply of Star will cease when the user base has reached the 100-million mark.
4.4 Star’s total supply
Star Network ceases supplying new Star when there are over 100 million registered users worldwide. Hence, the total number of Star supply depends on the earning activity of the entire community prior to cessation of new supply. This can be worked by the simple equation of
Total Star Circulation = Total Star Earned by Explorers + Developer Award for Core Team and Key Staffs
Developer award will be 25% of the sum of Star mined and will be credited to relevant beneficiaries Star wallet upon the cessation of new Star supply.
4.5 Star Network’s Token Economy, & Libra Drawing (for KYC + Unlocking Convertible Balance into Realized Balance)
What drives the price of a cryptocurrency? While there is not a definitive answer as the price is governed by numerous factors, it would be safest to consider the fundamentals — demand and supply. Price of cryptocurrency, just like any other financial asset, soars when it is highly sought after in the market and investors see this as a stronghold, and plunges when every crypto holder rushes to sell it to the market. Even for mainstream crypto like Bitcoin and Ether, it is not uncommon to see a double-digit plunge overnight when market sentiment is nervous. However, given the strong demand driven by solid fundamentals of these mainstream coins, prices will come back and eventually peak as time goes by.
These are the several factors that drive the demand and supply of crypto.
Scarcity and total supply
Maximum supply of Bitcoin is 21 million. While Ethereum does not have a definite total supply of Ether, its annual supply is capped at 18 million per year. When supply of crypto is definite and constant, prices will be well supported with growing demand. Hence, for any cryptocurrency network without a clear cut-off point of new supply, or the cut-off date is “to be confirmed” at the network founders’ discretion, or the cease of supply happens unrealistically late (such as when a network has reached 1 billion users), the value of crypto yielded from these networks could hardly be supported as the supply is virtually indefinite.
How can you use that crypto? Bitcoin and Ether are for P2P transfer for wallet holders. Binance coins are to pay the transaction fee when you use Binance’s exchange service. For a crypto to be valuable, it needs to be of practical value. When you evaluate whether or not to invest in a new crypto, consider the market’s general acceptance in that coin as a medium of exchange, the number of wallets available in the market, the ease of P2P transfer, or anywhere that you can use the coin. Otherwise, without any practical value, that “crypto” will just be a set of numbers and eventually draw no demand in the market.
Financial strength of crypto holder
As of the time of writing, Bitcoins trades at $55,900, 13.8% down from its all-time peak of $64,900. Imagine today a wealthy billionaire with strong belief in Bitcoin as optimistic as Elon Musk has successfully earned a Bitcoin, what will he do? Will he see it as a stronghold and embrace Warren Buffet’s value investing philosophy and keep that BTC in his portfolio for long?
Imagine another scenario. Today someone who always lives under poverty line in a developing country has successfully earned a Bitcoin (although this is technically impossible given he should not have the financial strength to pay for the device and energy needed to earn a Bitcoin, but let’s take this as an illustration), while he is also a strong believer in Bitcoin’s future, what will he do? Will he keep it for long or sell it right now to immediately improve his standard of living with $55,900?
Buy & sell actions on an exchange are what governs the price of a certain asset. Hence, when you evaluate the future value of a certain crypto, firstly consider the crypto holder composition. Does the former or the latter example reflect the majority of all crypto holders? If this is the first day that a new crypto is listed on exchange, would the majority of holders and investors buy, hold or sell? What will the closing price be?
This token economy is the foundation philosophy of Star Network. While everyone in the world with a mobile phone and internet connection can earn Star, we need to take measures to preserve and grow Star’s value in the long run.
One of the gates we need to keep tight is the Know Your Customer (KYC) due diligence process. The release of KYC slots means the release of Star’s liquidity as you can only turn part of your Nominal Balance to Realized Balance upon passing KYC.
Libra is the unlocking token needed for getting a KYC slot. We will release Libra step by step to users by different phases and by drawing. While all users will eventually be offered Libra (=KYC opportunities), some users will be given Libra earlier than others. Successful drawing of Libra are based on these factors:
1 — Higher Star balance means greater chance of successfully drawing a Libra
If you have a relatively higher Star balance, it means either you are a very early joiner of Star Network or you have made great contributions by inviting numerous new joiners to join. Either way, you deserve a reward to be entitled to KYC (by having Libra) and unlock and use your Star balance earlier.
2 — Random Factor
Randomness & luck do have its place. Also keep in mind that eventually everyone will be given a chance to pass KYC, it is just a matter of who first.
3 — Staking Campaigns for Less Lucky Users (later stage)
If luck is not your game, let’s raise your chances in an organic way. Once Star Network is listed on crypto exchange, we will launch a staking campaign for Stars. Given you have not passed KYC and your Nominal Balance is not yet unlocked into Realized Balance, you may purchase Stars from crypto exchange and stake your Stars with us. Star Network will pay you a certain percentage of your staked balance as staking interest. In addition to earning staking interest, if you have a higher staked balance, you will also have a higher chance to successfully draw a Libra and unlock your KYC slot.
4 — Get from Other Libra Holder
Libra is an NFT, hence it is a transferable asset with an expiry date of 7 days. If you cannot successfully draw a Libra, you can get it from other Libra holders. If you are a Libra holder, and you have passed KYC successfully, you have the option of using the Libra for yourself or keeping it and giving to another user.
Upon each peer-to-peer transaction of Star, 0.3% of Star token will be burnt. Say you have initiated a transfer of 100 Star to other users, the other user will receive 99.7 Star instead.
It’s for reducing the total supply and circulations of Star in order to make sure all Star token holders enjoy the appreciation of Token value.
5.1 Vision as an all-in-one Defi solution
Star Network is a social DeFi (decentralized finance) network visioned to be a cryptocurrency ecosystem for users to earn, store, trade and use your Star balance and eventually an one-stop decentralized financial platforms for all banking activities including saving & withdrawing cryptos and fiat money, borrowing & lending, trading, investment, payment settlement by debit cards or credit cards and even membership benefits with fiat merchants. That makes Star Network like your everyday bank, except that it is entirely decentralized so you are no longer manipulated by any middleman.
5.2 Global launch of Star Network app with Star earning and instant messenger functions (September 2021)
Star Network mobile app will be launched in September 2021 on both Apple App Store and Google Play Store. In this version, users are able to grow and store their Star balance, invite new users to join their teams and communicate with their teammates via Star Network instant messenger.
5.3 Libra Drawing, KYC and P2P transfer (forecasted Nov 2021)
Star Network is forecasted to enter the libra drawing and KYC stage in mid-Nov 2021. Upon that stage, everyone is free to draw Libra slots regularly to unlock your KYC slot and unlock your Convertible Balance into Realized Balance.
Once you have Realized Balance in your wallet (either by converting your Convertible Balance to Realized Balance by exercising Libra, or other users have transferred Realized Balance to your wallet), you can initiate peer-to-peer transfer regardless of your KYC status upon the app’s major update forecased in mid-Nov 2021. After the app is updated to the next version (forecasted to be launched in mid-Nov 2021), even if you have not yet passed KYC, your wallet is still able to receive Realized Balance from other user if they have initiate a transfer to your wallet, and in this case, you are free to use or transfer the Realized Balance to your wallet even if you have not yet passed KYC.
Upon each peer-to-peer transaction of Star, 0.3% of Star token will be burnt. That is, if you initiate a transfer of 100 Stars to another user, the recipient will be able to receive 99.7 Stars. The 0.3% token will be burnt. It’s for reducing the total supply and circulations of Star in order to make sure all Star token holders enjoy the appreciation of Token value.
5.4 Decrease and cessation of Star new supply (forecasted Nov 2021 to Nov 2022)
As the Star Network community grows further, Star Network will decrease rate of new Star supply by conducting rate halving when user base is grown to 500,000 (forecasted Nov 2021), 2,000,000 users (Forecasted Jan 2022), 10,000,000 users (Forecasted June 2022) and cease supply upon 100,000,000 users (Forecasted July 2023).
5.5 List on exchange (forecasted Dec 2022)
Depending on the maturity of Star Network community engagement, market volatility and other factors, Star Network is forecasted to list on major cryptocurrency exchanges by Dec 2022. By that time users are able to trade Star tokens with fiat money. Given the well establishment of Star Network ‘s system, the cease of new supply and the growing demand in Star token, Star Network is optimistic in the sustainable growth of Star value in long run.
5.6 Launching other Defi projects (Dec 2022 onward)
Star Network’s development will not stop at listing Star on exchange. Star Network will commence developing our own main net for Star. In addition, Star Network is dedicated to continue developing other new DeFi functions according to our project vision. That includes interest-bearing saving & withdrawal services, borrowing & lending, investment & trading, wallet payment solutions (debit cards and credit cards), membership benefits with fiat merchants.
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