The staking mechanism of Merlin Chain is designed to incentivize users to actively participate in the network while ensuring its security and stability. The main staking program, Merlin's Seal, allows users to stake assets and be rewarded in the form of M-Points and MERL tokens. These mechanisms not only reward early participants but also encourage long-term participation in the network through the generation of liquidity staking tokens (M-Tokens) and other incentive measures.

stake mechanism

Merlin Chain has launched the Merlin's Seal program, which aims to incentivize users to stake assets on the network. This staking campaign allows participants to lock up Bitcoin (BTC), Ethereum (ETH), and other supported tokens to earn rewards over time. The staked assets are mapped to Merlin Chain's Layer 2 to generate M-Tokens, which represent the value of the staked and can be used for multiple purposes in the ecosystem. The staking process is simple, users only need to bridge their assets to Merlin Chain and participate in the staking pool.

Merlin's Seal Plan is an important initiative launched by Merlin Chain to encourage users to stake assets and actively participate in the network. This staking plan is not only a way for users to earn rewards, but also helps to secure and stabilize Merlin Chain's Layer 2 network by locking valuable assets such as Bitcoin (BTC) and Ethereum (ETH).

The Merlin’s Seal plan has multiple stages and goals, aiming to maximize user participation and ensure the long-term sustainability of the network. The structure of this plan not only rewards early participants but also rewards users who contribute significant value to the ecosystem.

1. Stake and Asset Lock

Users participating in the Merlin's Seal plan need to lock their assets during the designated period. Supported staking assets include mainstream cryptocurrencies such as BTC and ETH, as well as other tokens such as BRC20 and BRC420 assets.

Once these assets are staked, they will be mapped to the Layer 2 network of Merlin Chain, generating M-Tokens. M-Tokens are the liquidity representation of staked assets, allowing users to interact with the Merlin ecosystem while the original assets are still locked in the staking pool.

1. Phased reward distribution

The Merlin's Seal program will run in multiple phases, each aimed at gradually unlocking rewards for participants. In the initial phase, users accumulate M-Points based on the value of their staked assets. These points are calculated by taking hourly snapshots of the staked asset value, ensuring that the rewards accurately reflect each participant's commitment and contribution. As the program progresses, M-Points can be converted into MERL tokens, which are the native governance and utility tokens of the Merlin Chain.

1. Liquidity Integration with DeFi

The program also incentivizes participants to contribute to the liquidity of the network. By staking assets and providing liquidity to decentralized exchanges such as MerlinSwap, users can earn additional rewards. This integration with DeFi protocols within the Merlin ecosystem allows participants to maximize returns while staking assets and supports the overall health and liquidity of the network.

1. Team Participation Mechanism

Merlin's Seal has introduced a team staking mechanism where users can create or join teams. Team leaders and members receive additional rewards based on the total value of their team's stake. This structure promotes collaboration within the community as more resources pooled together can earn a higher reward rate. This team-based approach not only increases the network's total locked value, but also strengthens the community bond among participants.

1. Security and long-term commitment

By locking assets in the Merlin’s Seal program, participants contribute to the security of the network. The staked assets serve as collateral, and if any participants engage in malicious activities, the staked assets may be slashed. This mechanism ensures that only users genuinely interested in the success of the network participate, thereby enhancing the overall security and integrity of the Merlin Chain.

1. The practicality of M-Tokens

The M-Tokens introduced by Merlin’s Seal plan add flexibility to stakers. These liquid tokens represent staked assets and can be used for trading, providing liquidity, or participating in decentralized applications (dApps) within the Merlin ecosystem. This feature allows participants to remain active in the network while their original assets are locked, ensuring that they do not miss opportunities within the ecosystem.

Function of M-Tokens

M-Tokens are liquidity staking tokens that represent the assets staked by users on Merlin Chain. They allow users to continue participating in the ecosystem during the lock-up period of the original assets. These tokens can be used for trading within the Merlin Chain ecosystem or interacting with decentralized applications (dApps) without unstaking the original assets. M-Tokens provide flexibility for stakers to maximize their interaction with various products and services within the network.

M-Tokens have a one-to-one correspondence with staked assets to ensure that users can retrieve their original assets at the end of the staking period. In addition, users can also use M-Tokens to participate in the wider ecosystem of the Merlin Chain, thereby interacting with projects and protocols on the platform and gaining additional opportunities for rewards.

Rewards & Incentives

The Merlin's Seal program offers multiple levels of rewards for participants. M-Points are the primary reward mechanism and are earned based on the value of the staked assets and how long they have been held. M-Points can be converted into MERL tokens, providing a direct financial incentive for staking. M-Points are calculated by taking an hourly snapshot of the value of the staked asset and are based on the daily average. These points are distributed daily and provide additional rewards to users who stake large amounts of assets or form teams within the ecosystem.

20% of the total supply of MERL tokens is reserved for staking rewards distributed through Merlin's Seal program, an important allocation designed to incentivize early participants. This allocation includes not only M-Points, but also additional incentives for providing liquidity, participating in DeFi protocols, and interacting with other projects. For example, participants can stake ETH through the StakeStone program to earn additional rewards, or provide liquidity through MerlinSwap to receive extra incentives.

Highlights

• Merlin's Seal is the main stake plan, and users can earn rewards by staking assets.
• M-Tokens are liquid staking tokens that provide users with flexibility and utility within the ecosystem.
• The M-Points obtained through staking can be converted into MERL tokens, providing economic incentives.
• Team stake increases collaboration, and team participation can earn additional rewards.
• Staking aligns the interests of participants with network stability, promoting the security of the network.