Once you have delegated your TLOS, there are things you need to consider going forward:

• Firstly, rewards are auto-compounded. So you don’t need to do anything to compound it once you have started staking.
• Use our TLOS staking calculator to plan your staking journey and to work out what your rewards will be under different network conditions.
• If you want to unstake your TLOS, you will need to wait 4 days before you have access to your tokens.
• Lastly, as a participant in the Telos Ecosystem, once you have staked your tokens, you can vote onTelos Governance Proposals. While your contribution and vote are highly valuable to the ecosystem, participating does not affect the sum of your rewards.

You do not need to choose a validator on Telos network, staking on TLOS has no relation to validators.

The Staking Rewards on TLOS are generated by:

Reserve Allocation – 1,700,000 TLOS/month is allocated to the Telos Resource Exchange (REX). It allows developers to lease TLOS in order to pay for network resources at an affordable rate. At the same time, TLOS holders loaning these resources will receive a high yielding return, paid out by REX funding. The rewards/apy you get depends on the total number of TLOS staked to REX and on the reward pool.

Please note that the total annual rewards are divided by all active stakers; hence, as the amount of staked tokens goes up, the reward rate goes down. 

You are welcome to play around with our Telos staking Calculator to get a better feel of how these metrics can influence your rewards. 

We strive to make staking as safe and transparent as possible, however, it’s important to consider factors that may influence whether a particular staking option is appropriate for you.

Slashing risk: Your TLOS cannot be slashed.

Unbonding risk: The unbonding period for TLOS is 4 days. Crypto markets are highly volatile, and investors need to be aware that they cannot sell their tokens immediately once they have staked them. They first need to wait 4 days for the tokens to unbond before they become liquid. Please take note of this lockup before you decide to stake. Consider keeping funds liquid if you do not intend to hold TLOS long-term. 

Protocol security risks:There is an inherent risk that the protocol could contain unknown bugs, this risk applies not only to staking but also the investment in Telos.

This list is not exhaustive and other risks may apply.

TLOS is is the native token of the Telos network that is used to carry out the key functions of the platform as detailed below:

Token Utilities

Staking: Users can temporarily lock TLOS up to contribute to the security of the Telos Network.

Resource token: TLOS can be used to pay for resources, such as CPU and bandwidth, which are required to execute smart contracts and interact with dApps on the Telos network.

Governance: TLOS is used to vote on governance proposals on the network. Only staked tokens are eligible to be used for governance voting. The amount of voting power is measured in terms of stake. Unlike many other networks, as a delegator, you are also able to participate directly in governance, rather than passing your votes to the validator. Telos doesn’t have proxies, so anyone can stake without necessarily voting for any BP. 

The Telos network uses the Delegated Proof of Stake (DPoS) consensus algorithm to validate transactions and secure the network. The DPoS consensus decides its block producers according to the votes of the entire community of TLOS holders, which allows the network to achieve high scalability in block production. In the DPoS system, token holders vote for a group of “block producers” (also known as validators) who are responsible for validating transactions and adding them to the blockchain. These block producers are selected through a continuous voting process, and they are required to meet certain performance criteria in order to maintain their status as a block producer. When a block producer proposes a new block, other block producers must validate the block and reach consensus on its inclusion in the blockchain. Once the block is accepted by a supermajority of block producers, it is added to the chain. There can be up to 21 active block producers on the Telos network at any given time.

The maximum supply of TLOS is set at 355 million. Currently, the rate of inflation to the total supply is 0%, which may be increased to 1% in the future to cover the expenses of block producers. Payments to block producers and other vital entities are currently made from the network’s reserve funds, which are approved by token holders through voting. The circulating supply grows by 4.1 million TLOS per month, which comes from the network’s reserves. As a result, the circulating supply increases over time, but the total amount of TLOS in existence does not. When all reserves are depleted, the community may choose to introduce a low inflation rate that benefits all stakeholders or fund the network through charges for premium services.

Initial Distribution Breakdown 

The TLOS token was created in 2018 when the network’s genesis snapshot was taken, which was based on the EOS network. Each account was capped at 40,000 TLOS, this measure was taken to prevent the concentration of a large amount of tokens in the hands of a few “whale investors” and to maintain a fair distribution of ownership.

The initial snapshot of the TLOS network created a total of 330,753,222 tokens. 12 million of these tokens were allocated to the Telos Founders Rewards Pool and the Telos Foundation, which enabled the network to launch without the need for an initial coin offering (ICO) or venture capital funding. This approach is unusual among modern blockchains but is crucial for achieving true decentralization in a Delegated Proof of Stake (DPoS) network. 

A maximum of approximately 900,000 TLOS per month is distributed to validators, and 1,700,000 TLOS per month is set aside for the Telos Resource Exchange (REX). REX enables developers to lease TLOS to pay for network resources at a cost-effective rate. At the same time, TLOS holders who lend resources through REX will earn a high yield on their investment, paid out from REX funding.