How Dual Staking Works

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Core operates on the Satoshi Plus consensus, integrating three delegation sources to secure the network:

• Delegated Proof of Work (DPoW): Bitcoin miners delegate hash power to Core validators.
• Delegated Proof of Stake (DPoS): CORE token holders delegate their tokens to validators.
• Non-Custodial BTC Staking: BTC holders stake directly on the Bitcoin network and delegate their stake to Core validators.

Dual Staking, an enhancement to Core’s Non-Custodial BTC Staking, enables participants to maximize rewards by staking both BTC and CORE simultaneously. This strategy strengthens the Core network while unlocking higher Bitcoin staking yields based on predefined CORE staking thresholds.

By meeting specific CORE-to-BTC staking ratios, users gain boosted Bitcoin staking rewards, paid in CORE. While Dual Staking enhances BTC staking yields, it does not affect CORE staking rewards directly.

Boosted Yield Thresholds

Currently, Satoshi Plus rewards are allocated via three pools, one for each of the three entities participating in the election of Core validators, namely (1) Hash Power Delegators, (2) Bitcoin Stakers, and (3) CORE Stakers.

Dual Staking does not affect these reward pools, but does enable Bitcoin stakers who also stake CORE tokens to earn a higher proportion of rewards in the Bitcoin Staking pool. In this section, we cover in detail the working of the grading algorithm with respect to dual staking.

1. Boosted Yield Levels
   Under Dual Staking, there are 3 boosted yield tiers for Bitcoin Staking based on the proportion of CORE staked relative to Bitcoin staked. For Solo-Stakers of only Bitcoin, a fourth tier exists with the lowest Bitcoin staking rate. It is important to note that the annual reward rate for Bitcoin Staking can fluctuate significantly, often due to varying prices and other market dynamics. As a result, the actual boosted yields may change daily based on market conditions.

   • P_BASE = the BTC staking base rate
   • P_Level1 = the BTC staking base rate + Level 1 boosted yield
   • P_Level2 = the BTC staking base rate + Level 2 boosted yield
   • P_Level3 (P_MAX) = the BTC staking base rate + Level 3 boosted yield

Effectively, the CORE emissions are distributed pro rata based on the BTC TVL, weighted based on their dual staking tier (CORE:BTC).

2. Staked CORE Thresholds and Staking Ratios (R₁, R₂, R₃)
   The deciding mechanism for a Bitcoin staker’s yield tier (P_BASE, P_Level1, P_Level2, or P_Level3 (P_MAX)) is based on CORE tokens staked relative to Bitcoin staked, where R represents the CORE:BTC Ration and R₃ > R₂ > R₁. The current CORE:BTC staking ratios are as follows:

   • Staking Ratio R1 = 2,000 CORE per 1 BTC
   • Staking Ratio R2 = 6,000 CORE per 1 BTC
   • Staking Ratio R3 = 16,000 CORE per 1 BTC

Keeping these ratios in mind, users can calculate the required threshold for each tier as follows:

• Staked CORE Threshold for P_Level1 = BTC staked quantity * Staking Ratio (R₁)
• Staked CORE Threshold for P_Level2 = BTC staked quantity * Staking Ratio (R₂)
• Staked CORE Threshold for P_Level3 (P_MAX) = BTC staked quantity * Staking Ratio (R₃)

note

The staked CORE and/or staked Bitcoin can be distributed across multiple active Core validators.

3. Boosted yield level determination for each (1) staked Bitcoin
   • If staked CORE amount < R₁, the user is in tier P_BASE
   • If R₁ =< staked CORE amount < R₂, the user enters tier P_Level1
   • If R₂ =< staked CORE amount < R₃, the user enters tier P_Level2
   • If staked CORE amount >= R₃, the user enters tier P_Level3 (P_MAX)

note

Staking ratios and the number of levels are configurable and subject to change by governance vote.

Example

The following is a simple example explaining how to calculate the required CORE to stake, based on the above mentioned parameters, to unlock boosted yield tiers for Dual Staking.

Now, the user will have to stake CORE as per the following Staked CORE Thresholds to enjoy a higher yield on their staked BTC with the above variables:

• Staking Ratio R₁ = 2,000
• Staking Ratio R₂ = 6,000
• Staking Ratio R₃ = 16,000
• Staked BTC quantity = 10 BTC

The Staked CORE Thresholds with the above variables are:

• Staked CORE Threshold for P_Level1 = 10 * 2,000 = 20,000 staked CORE
• Staked CORE Threshold for P_Level2 = 10 * 6,000 = 60,000 staked CORE
• Staked CORE Threshold for P_Level3 = 10 * 16,000 = 160,000 staked CORE

Hence, the staked BTC in this example will enjoy a yield of

• P_BASE if the amount of staked CORE is below 20,000
• P_Level1 if the amount of staked CORE is above or equal to 20,000 but below 60,000
• P_Level2 if the amount of staked CORE is above or equal to 60,000 but below 160,000
• P_Level3 (P_MAX) if the amount of staked CORE is above or equal to 160,000

note

The multiplier on each boosted yield tier is dynamic and subject to change as per the supply and demand conditions of the market

info

For your new dual staking tier to take effect, you may need to follow two steps. This applies to users who already have BTC staked in earlier rounds at 00:00 am UTC and decide to stake additional CORE to move up tiers. First, after staking CORE, wait until the next 00:00 UTC. Then, claim all your rewards anytime after 00:00 UTC to reset the tier calculation system. Your new tier will activate as soon as you complete the claim. Both steps are essential to ensure your new tier takes effect.

How to Qualify for Dual Staking Rewards

To enable higher Bitcoin staking yields through Dual Staking, users must:

1. Stake both BTC and CORE, ensuring the CORE staked meets or exceeds the minimum Dual Staking threshold.
2. Use the same wallet for both CORE staking and receiving BTC staking rewards.

This approach ensures seamless reward distribution while incentivizing deeper network participation.

Considerations on optimizing yields

• Validator hybrid scores represent the total weighted delegations across all validators. Generally, higher hybrid scores correlate with lower BTC and CORE staking rewards, although this relationship is not strictly linear.
• When staking a relatively low quantity of assets that don’t significantly alter the staking distribution, stakers are recommended to simply delegate the BTC or CORE staking to the validator that gives out the highest reward.
• When staking a relatively large quantity of assets that can meaningfully alter the staking distribution, stakers are recommended to diversify the BTC or CORE staking across multiple validators to prevent over-concentration and maintain high rewards.
  • For instance, diversifying your stake across 6 to 10 validators with the highest rewards can help reduce the impact of high hybrid scores and maintain optimal yields.
• Minimize the need to transfer and/or redelegate BTC staking to another validator to avoid loss of reward during the process.
• Avoid validators with high hybrid scores.