What is the purpose of leasing your EOS and to who? block producers? And can you still spend your EOS when you lease it?

Which account currently has the most leased EOS?


What is the purpose of leasing your EOS and to who?

The purpose of leasing EOS is to create a market that facilitates a more efficient allocation of network resources by decoupling the various uses of the EOS token.

For instance, some users may hold EOS for voting or speculating, while others may need EOS to access the network bandwidth (CPU and NET.) Because the former group may not need to use the network resources proportional to their holdings, and the latter group may not want to have an EOS exposure proportional to their need for resources, leasing EOS creates a market for satisfying the needs of the two groups.

As such, a dApp developer may rent EOS to stake it for CPU/NET resources and then return the EOS at the end of the period without being exposed to market volatility. Another example would be an airdrop which requires significant CPU--the token distributors may rent EOS for the airdrop period to avoid potentially prohibitive costs. In general, dApp developers are assumed to be the ones that will generate demand in the market.

And can you still spend your EOS when you lease it?

They'd be staked or locked for a fixed period of time, depending on the implementation. At the very least, the EOS will be illiquid for three days--the period required to unstake--, but it can be more depending on the lease contract agreed upon.

Which account currently has the most leased EOS?

Despite being mentioned in the whitepaper, this mechanism is still very young right now in terms of implementations, so no one has much more than a several EOS leased.

Known projects:

  • Resource Exchange (REX) is a native implementation that is being worked on by Block.one. This implementation will reward voting participants through multiple streams (RAM fees, name auctions, and others.) No release date has been published yet.
  • Chintai was launched this week, but it's still in the process of price discovery.
  • DelegationHub launched about two weeks ago, but there appears to be very little demand or activity at the moment.

And how does it work?

Fundamentally, it's meant to use the native delegatebw functionality and employ smart contracts to create a risk-reduced system where you are guaranteed to have your EOS back after the lease period ends. However, implementations differ significantly, as, for instance, DelgationHub doesn't seem to use smart contracts for the logic and contractual locking, and they opted for an off-chain database.

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