What is PNK token?
PNK token is the utility token of the Kleros protocol.
PNK token is used for
- Keep jurors incentivized to vote honestly.
- Protect against 51% attacks of the protocol.
Holders of the PNK token can stake their tokens in any of the Kleros courts.
How does the PNK token work?
To Keep jurors incentivized:
- Jurors that vote with the majority of jurors – receive part of the arbitration fee.
- Jurors who don’t vote with the majority – have part of their staked PNK transferred to jurors who did.
Resistance to 51% attack
To change the outcome of a court decision and attacker would have to:
- Bribe more than 50% of token holders
- Buy more than 50% of supply.
- And by conducting the attack also devalue the token significantly.
What is Kleros?
Kleros is a protocol for decentralized arbitration on the Ethereum blockchain.
- Person A orders a service from Person B.
- Person B delivers the service.
- Person A is not happy with the result.
- Person B insists the service is delivered as agreed.
Person A and Person B could now send their dispute to be solved by a Kleros court if they initiated the agreement via Kleros.
A Kleros court
A PNK holder stakes his tokens in a court. The more tokens are staked the more likely he’ll be drawn as a juror in a dispute.
- The dispute between Person A and Person B is sent to Kleros.
- The court draws jurors. The more PNK staked – the more likely to be drawn.
- The juror are presented with the initial agreements and subsequent evidence by Person A and B.
- The jurors submit their decision.
- Fees are paid from Person A and/or Person B
- Part of stakes are paid from jurors who did not vote with the majority to juror who did.
The fees and rewards are subject to change through governance. More on p.6 in whitepaper.
The court works with something called a schelling game. In order to receive the fee and not lose part of their stake – the jurors will vote on what they think the other jurors will vote on.
PNK token issuance
Total supply: 1B PNK (1,000,000,000 PNK)
- 18% Team
- 12% Kleros cooperative reserves
- 4% Airdrops
- 66% Juror incentive programs