Getting the most out of the ÐTH token

Many of you have been curious about ÐTH token, wondering how it works, why you need it, and what advantages it will carry for crypto buyers, sellers, and physical shop owners.

In this post, we’ll outline how the ÐTH token will safeguard against network congestion and increase market safety, and then we’ll give a rundown of the token’s general usage, loyalty programs, and future development.

Reducing Network Congestion and Improving Market Safety

Because we want registering as a teller on the Dether network to be simple, we need a way to prevent low-quality or fraudulent listings. To prevent this, a staking mechanism requires that participants to lock in a minimum amount of ÐTH prior to transacting. Those with larger transaction volumes are required to have larger safety deposits because they have greater potential to negatively impact the network through fraud or scams

Because staking a cryptocurrency or fiat currency would require a much more intensive price hike and accompanying politics to effectively protect market participants as the network gets larger or smaller, using the DTH token means that the stake amount is automatically correlated to network valuation, and therefore protection for market participants will rise or fall depending on the total value of the network.

To prevent attackers from raising capital and attempt a network takeover by staking large amounts to create many fraudulent accounts, any attempts to aggressively purchase en masse will be met with sharp price increases, which would make the attack far more expensive and likely unprofitable.

An overview on how it works

Just like taxi drivers who must hold medallions to do business in many parts of the world, users wishing to operate as sellers or shops must stake a minimum amount of ÐTH tokens for entry. This requirement helps Dether attract only real users willing to engage in authentic transactions on the marketplace and Dether map. Required ÐTH stake amounts per account are based on monthly transaction volumes that a vendor wishes to conduct.

For each vended ETH or item, a user earns loyalty points, which may be staked to access premium services such as “owning” a geographical zone or “owning” a geography-locked keyword on the Dether search engine for fixed periods of time.

1. For the ether seller

Let’s imagine that Bob wanted to become a seller in Paris, so he had to stake 50 ÐTH to be listed and to be able to operate. He can now trade 5 ETH/month. If he wants to be able to trade for more, he’ll need to add more ÐTH to his safety deposit: for each additional 10 ETH he wants to trade, he’ll need to add 50 ÐTH /month. Bob can now stake his loyalty points, in order to be able to have premium zone services.

2. For shops

Now let’s imagine that Bob wants to list his restaurant as accepting ether on the Dether map. He will have to stake ÐTH tokens for 50 ÐTH. If he wants to generate loyalty points, the shop has to stake additional tokens based on the volume of sales generated.

The longer a user stakes ÐTH, the faster they will earn loyalty points. In addition, the more trades a user makes, the faster they earn loyalty points. We want to encourage sellers to be active on the map; that’s why the number of loyalty points will be correlated with the number of trades a user makes, not only the volume.

Loyalty program + premium services

Users are rewarded loyalty points per ETH volume earned. The reward amount is based on transaction volume and number of trades. This means that frequent small transactions with different users are rewarded more generously than a handful large transactions with a select few.

Dether Zoning System

Zones are pieces of land that users can users can exert influence over by using premium features such as Dether map visibility. We’ll start zones off as areas of 30 square meters on the Dether map, but they will eventually be able to adapt to their localities by growing, shrinking, splitting, and merging.

Zones must be “owned” for a particular purpose through winning auctions with bids placed in loyalty points. An auction system will take place like this:

The user selects the zone (or multiple zones) they want to own for a specific benefit such as map visibility. Each zone may be empty or possessed by another user. The challenging user can outbid the previous owner with more loyalty points. If multiple zones are selected, the total bid is divided by the number of zones for the per-zone bid. The bid auction system is open for 24 hours. The auction winner will “own the zone” and enjoy the specific benefit for at least 24 hours. Zone owners will lose a percentage of their staked loyalty points every 24 hours to prevent the concentration of power. As we make more progress, community members are encouraged to take advantage of our open protocol to create new benefits for zone owners.

The premium features that Dether team has implemented for zones include, preferred visibility on the Dether map and fee collection privileges to allow other sellers to operate in zone for fees collected by the zone owner.

Premium keywords

Shops will have the possibility to own premium keywords tied to geographic identifiers such as city names, zip codes (or similar), zones, or group of zones. For example, a restaurant accepting cryptocurrency in Paris could own the keywords “restaurant in Paris 75009.”

To read about the ÐTH token in greater detail, please visit section 5 of Dether’s whitepaper.