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Spark Token

Spark Token

Spark is the native token of the Flare Network

Flare is a distributed network with some unique properties. It can be used to create two-way bridges between networks, such as Ethereum and the XRP Ledger. This means that it allows the XRP token to be used with smart contracts.

Spark is the native token of the Flare Network. Its base use case is similar to that of other native tokens – to prevent spam attacks. If transactions would be free, spamming and congesting the network with useless transactions would also be free.

SPARK is the native token for Flare, a distributed blockchain network and smart contract platform utilizing the Avalanche consensus protocol, compatible with the Ethereum Virtual Machine while conforming to the Federated Byzantine Agreement (FBA). FBA consensus protocols do not rely on economic mechanisms to secure the network. The Spark Dependent Application model serves as a blueprint for building applications on Flare. The Flare Network provides a Turing complete smart contract platform, based on the Avalanche protocol, in a FBA setting to enable a scalable, safe and decentralized network, freed from the constraints and safety conflicts of utilizing economic methods to prevent Sybil attack.

In addition, the Spark Token can be used for the following functionality:

As collateral within decentralized applications (DApps)

For providing data to an on-chain oracle

To participate in protocol governance

These three components aim to enable an ecosystem of applications that rely on Spark called Spark Dependent Applications (SDA). SDAs can also allow for trustless representations of tokens on other networks – even ones that don’t natively support smart contracts. Is it starting to come together? Yes, this is where XRP comes into the picture.

Further Information on The Spark Token Distribution

This post is intended to provide further precision around the Spark token distribution mechanism.

Token Supply

Flare is creating 100 Billion (Bn) Spark tokens at the outset of the network. How these are distributed and when they become available is discussed below.

Claim formula:

The claim formula below sets out the amount of Spark that an individual XRP holder can expect to receive in total.

Where the variables are:

Spark claimable: The amount of Spark claimable by an XRP address.

XRP owned: The amount of XRP in the XRP address at the time of the snapshot.

XRP total: The total amount of XRP in existence at the snapshot date.

XRP Ripple: The XRP held in Ripple related accounts at the time of the snapshot including escrowed balances.

XRP NPE: The XRP held by non-participating exchanges at the snapshot date.

Claim eligibility:

Provided that you are not in a modified group (details below), how many Spark you are eligible to claim therefore depends only on the participation of exchanges. This is because the subtraction of the non participating exchange balances makes the denominator smaller and thus increases the share of the 45Bn Spark that claimants can claim.

Modified Groups:

Excluded

Other than Ripple inc and the non-participating exchanges, there are a few groups that are completely excluded from the distribution. These are Jed McCaleb and accounts that are known to have received XRP as a result of fraud, theft and scams.

Unlike Ripple Inc and the non participating exchanges, the Spark balances that would have gone to these excluded participants are instead to be placed in a reward pool to incentivise the minting of F-Assets starting with FXRP (see below).

Individual Whale Cap:

A 1Bn XRP cap is set on any group of XRP accounts known to belong to the same individual. This means that such an individual may claim Spark using 1 Bn XRP tokens but no more.

This amount is termed the Whale cap. The Spark that these Whales could have claimed with their XRP, above the capped amount, is also put into the incentive pool for minting FXRP.

For the purposes of the distribution, any accounts that receive XRP from these capped accounts from the publication of this post until 12/12/20 will have this amount of XRP deducted from the amount of XRP that they may claim Spark with.

What you will receive and when:

At network launch, each account that has claimed Spark will receive 15% of the total Spark for which they are eligible. This is 15% of the Spark claimable term in the equation above. The remaining Spark claimable will be distributed over a minimum of 25 months and a maximum of 34 months.

Each month,* a pseudorandom number in the interval $\text{[2,4]}$ will be generated by the Flare Time Series Oracle (FTSO). This number corresponds to a percentage of the initial remaining Spark claimable.

For example, if person X has 1000 Spark claimable and 4% is picked every month by the FTSO, they receive 1000*15% = 150 Spark at day 1, and then (1000-150)*4% = 34 additional Spark per month for 25 months, coming to a total of 1000 Spark.

The average of the pseudorandom number draws should equate to 3% per month, the midpoint between 2 and 4. At this rate, the distribution will be complete within 34 months. The process runs until either all Spark have been distributed (minimum 25 months) or 34 months have passed. At 34 months, any remaining undistributed Spark is burned or distributed based on a governance vote. (If there is a burning event this reduces the amount of tokens that an individual receives overall, but their percentage ownership of the token remains unchanged.)

No one is treated differently in this process: it applies equally to the amounts that Flare Networks Limited and the Flare Foundation will receive.

Timeline

Further reading

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Author
Link
Type
Date

Documentaries, videos and podcasts

Title
Date
Link

Hugo Philion Interview - Flare Networks, SongBird & Spark FLR Token

October 27, 2021

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