The Nolus blockchain is built on a network of validators contributing to the protocol's consensus, who come from an open ecosystem of contributors and infrastructure providers. Since the Nolus blockchain is a Proof-of-Stake (PoS) system, nodes need to stake NLS tokens in order to validate the network. The NLS tokens can also be delegated to validators by users who, for whatever reason, choose not to run a node themselves.
The Nolus ecosystem has been uniquely designed to incentivize holders and maximize their benefits through staking, encouraging economic growth and the network's longevity. The staking incentivization mechanism will further ensure that a sizable proportion of the NLS token supply is delegated to validators contributing to the network's consensus.
Staked NLS tokens will grant borrowers lower interest rates when leveraging through DeFi Lease positions. Reduced interest will be calculated dynamically based on the staking duration. The longer the staking duration, the lower the interest for consequent DeFi Leases. However, the interest will reset to the base rate upon an undelegation event (regardless of the amount).
Lenders will have to buy and stake NLS tokens to increase their rewards on supplied stablecoins or tokens. The more users utilize the protocol, the more NLS tokens will be bought to achieve higher APR. Consequently, the token value will grow proportionally to the Protocol’s Total Value Locked.
The majority of the revenue will come from the interest-bearing DeFi Lease contracts. Part of the total operating income will be used to buy back NLS tokens on the open market, which would subsequently be added to the Nolus Incentives Pool used to pay out Lender’s rewards.
The NLS token is a governance token that allows staked token holders to decide the future of the protocol, including every implementation detail. Governance is a critical component of the Nolus Protocol’s evolution. Active stakeholders of the network will be responsible for proposing, vetting, and passing protocol upgrades.
To use the Nolus network, each user must pay gas fees in the native asset, the NLS token. A custom tax module makes it possible to unlock another revenue stream for the native NLS token by diverting part of the transaction fee paid by the user to the incentives pool used to pay lenders. In simple terms, this means that the user would pay a fee from which a portion would go to the validators fulfilling their minimum gas requirements, and the rest would go back to the Protocol. The part that goes to the Protocol has a default value of 40% and is subject to change through governance.