How to get more AO tokens Tips for maximizing your AO tokens

How to get more AO tokens Tips for maximizing your AO tokens! The acquisition of AO depends on the amount of funds and the type of token assets held. All we have to do is to find a way to maximize the efficiency of acquiring AO tokens under a limited amount of funds. Arweave officially released the economics of AO tokens at 23:00 on June 13th, Beijing time. Based on the current information, we will analyze how to obtain AO tokens from the perspective of maximizing efficiency!

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Interpretation of AO Token Economics Model

**AO Token Economics Beautified Version** According to AO Token Economics, AO is a 100% fair launch token that follows the Bitcoin economic model. Similar to Bitcoin, AO has a total supply of 21 million tokens. Distributed every 5 minutes, the monthly allocation is 1.425% of the remaining supply, similar to Bitcoin’s halving cycle (4 years). The difference with Bitcoin is that AO's halving is a smooth process rather than a sudden "halving event". Bitcoin’s halving occurs every 210,000 blocks (an average of one block every 10 minutes), approximately every four years. The halving of AO tokens occurs on a monthly basis, gradually reducing the supply. Although this progressive halving will not have a significant impact on the efficiency of obtaining AO, it cannot be ignored that the earlier you obtain AO, the greater the benefit.

**At the same time, officials have repeatedly emphasized that AO tokens are 100% fair launch tokens. From the current point of view, the official understanding of "100% fair start" is: ** AO tokens can only be obtained by holding specific assets (currently $AR, $AOCRED, $stETH). **This means that even official teams, investment institutions and ecological community projects have not received reserved shares. ** **At this point, AO is in sharp contrast to many encryption projects on the market, demonstrating the magnanimity of the project side. ** **This also means that the acquisition of AO depends entirely on the amount of funds and the type of token assets held. ** **Therefore, our goal is to find ways to maximize the efficiency of acquiring AO tokens within limited funds. **

**AO token acquisition** Currently, AO token acquisition is divided into two stages: * **Phase 1** ended on June 18, and **Phase 2** started at the same time. The acquisition time of the first phase was only announced on June 13, the day Token Economics was announced, but it was also expected, that is, it will be minted from February 27, 2024 (AO public testnet online) to June 18 100% of AO tokens will be issued to $AR token holders. Tokens are issued based on the balance held by each wallet address every 5 minutes. As of June 13, 2024, approximately 0.016 AO tokens will be available for each $AR. A total of more than 1 million AO tokens were distributed throughout the first phase.

Strategy to maximize the acquisition of AO tokens

The circulation in the first stage only accounts for about 5%, and the second stage is the highlight. What we need to focus on in the second stage is how to maximize the acquisition of AO tokens. 33.3% of AO tokens will be distributed to AR token holders. 66.6% of AO tokens will be used to stake other assets into AO (currently only stETH). At the same time, for AOCRED, AO will be exchanged at a ratio of 1000:1 (this part of AO tokens will come from the AO tokens generated by AR held by Forward Research).

**After the second phase starts:** * Each pegged token (AR) earns 0.016 AO in the first year. * The number of AO tokens obtained by depositing other eligible cross-chain assets (non-AR assets) into the AO network is determined by the following formula: ``` Cross-chain asset transaction volume x annualized staking yield x total cross-chain asset volume ``` **Currently, stETH is the only eligible cross-chain asset. ** Therefore, 66.6% of AO will be used to distribute to other assets staked in AO, of which: * **The number of AO tokens obtained by staking stETH** will depend on the ratio of the value of your pledged stETH relative to the total asset value of the pool.

If the assets you pledge account for 0.01% of the total assets of the fund pool, you can get 210 AO after staking for one year. The pool is currently worth over $20 million (can be viewed here ). Assuming that after the second phase of opening, the TVL of the capital pool reaches US$1 billion and remains stable for one year, then: - If you stake $1,000 of stETH, you can get 2.1 AO after one year. - If AR market cap is $2 billion and remains stable for a year, holding $1,000 of AR in your wallet will yield 0.485 AO after one year. Currently, it seems more cost-effective to stake stETH. But the market cap of the stETH pool and AR is unlikely to remain unchanged in a year. Therefore, the calculation needs to always be based on the ratio of TVL to AR market capitalization (in USD) of other asset pools.

• When the market value of the capital pool TVL / AR ≈ 2, the AO obtained by pledging other assets of the same value is similar to holding AR of the same value;

• When the market value of the capital pool TVL / AR > 2, the AO obtained by holding AR of the same value will get more AO than pledging other assets of the same value;

• When the capital pool TVL / AR market value

Note that the AO tokens minted after the launch of the second phase will not be unlocked until February 8, 2025. By then, the circulation rate will be 15% and the total circulation will be around 3 million.

**Beautify the article:** In addition, we can also calculate the risk and cost of obtaining AO, which greatly affects the pricing of subsequent AO. AR holders only need to hold it, while stETH is obtained by staking ETH on Lido. Currently, stETH has an annualized rate of return (APR) of 3.3%. Since staking stETH in AO requires transferring this part of the annualized income interest to the AO project party, which is originally the vested income of stETH holders, the APR of stETH can be regarded as the cost of stETH pledgers. If the pool TVL reaches 1 billion, the cost for stETH stakers to obtain AO will be $15.7. However, this is calculated with control variables. The specific calculation formula is as follows (only considering the current situation where stETH is the only cross-chain asset):

For short-term investors, both pledging stETH and holding AR require bearing the risk of currency price decline. Of course, many CEXs provide 0-leverage currency borrowing services, and the borrowing interest rate is usually not higher than 1%. However, considering the long return period for obtaining AO incentives, please weigh it yourself before making a decision. At the same time, the current cost of exchanging AOCRED for AO is about US$50-60 per AO (please make sure to exchange AOCRED for AO before June 27, 2024, and it will be invalid if it is overdue). It also needs to wait until February 8, 2025 to unlock it, so The price of 1000*AOCRED can be regarded as the AO futures price. However, after the release of the AO test network, the market value of AR has increased by far more than 1 billion, and the total circulation will only be more than 3 million. The AO currency price also has a lot of room for imagination. .

For long-term investors, taking time to eliminate the risk of market fluctuations can not only obtain dividends from the increase in principal, but also continue to enjoy AO interest (including AO growth dividends).

The economic model of AO tokens includes the following key points

• Minting mechanism: AO tokens are minted in a decentralized manner to ensure fair distribution and transparent operations.
• Distribution strategy: Token distribution takes into account the needs of early supporters, developers, community incentives and other aspects to ensure the healthy development of the ecosystem.
• Economic model: An innovative economic model is adopted to encourage node participation and resource sharing through a token incentive mechanism.

Technical Architecture

• Trustless Computing Environment: AO provides a decentralized operating system that allows developers to launch smart contract-like command line processes that can run without being restricted by a specific location , achieving seamless user interaction.

• Parallel processing: Inspired by the actor model and Erlang, AO supports multiple communication processes running in parallel, coordinated through native messaging standards, allowing processes to run independently and efficiently.

• Resource Utilization: AO's architecture is based on the delay evaluation model of SmartWeave and LazyLedger. Nodes can reach consensus on program state transitions without performing calculations, and the status is prompted by the process message log hosted by Arweave.

• Data storage: The AO process can load data of any size directly into memory for execution and write the results back to the network. This setting eliminates typical resource limitations and supports parallel execution of complex applications.

• Modular: AO’s architecture allows users to choose the virtual machine, ordering model, messaging security guarantees and payment options that best suit them. All messages are ultimately settled into Arweave’s decentralized data layer, unifying this modular environment .

• Economic Security Model: The network uses a token economic model to ensure process security. Users can customize the security mechanism to ensure economically reasonable security pricing and efficient resource allocation.

8 key facts and dates of AO tokens:

1. AO is a 100% fair issuance token that follows the Bitcoin economic model.

2. AO tokens will be used to protect messaging in its network.

3. The minting mechanism will run retroactively starting from 13:00 EST on February 27, 2024 (block 1372724). 100% of AO tokens minted during this period have been vested to Arweave token holders based on their respective balances held every 5 minutes. If users hold AR on an exchange or custodian, users should ask them how to receive their tokens.

4. In the future, one-third (33.3%) of the AO tokens will be minted to AR token holders according to their ownership every 5 minutes. Two-thirds (66.6%) of AO tokens will be minted in the future to transfer assets into AO to strongly stimulate economic growth.

5. The first phase of the bridge contract is online today. During this pre-bridge phase, your tokens will remain securely on their native network while you earn AO tokens. Once the second phase of the bridge goes live, you will be able to deposit your assets into the new bridge contract and use them on AO - while earning rewards. You can deposit staked Ethereum (stETH) tokens into the audited pre-bridge contract at https://ao.arweave.dev/#/mint/ethereum/.

6. Transition rewards will start at 11:00 am ET on June 18, 2024.

7. Users can withdraw tokens from the pre-bridge at any time, but they can only start earning AO after the rewards start on June 18. Rewards are distributed every 24 hours.

8. AO tokens will remain locked until approximately 15% of the supply is minted. This will happen around February 8, 2025.

AO is a 100% fair issuance token modeled after Bitcoin

Like Bitcoin, the total supply of AO is 21 million tokens, and the halving cycle is also 4 years. AO is distributed every 5 minutes, monthly The distribution amount is 1.425% of the remaining supply. As of June 13, the inventory of AO was 1.0387 million. This makes them extremely scarce. By comparison, Ethereum has 120 million, Solana has 461 million, and Ripple has 55 billion.

AO’s minting mechanism means that although the number of newly minted tokens will be halved every 4 years, there will not be a sudden “halving event”. Instead, the number of new tokens will decrease slightly each month, resulting in a smooth issuance schedule.

While most token distribution models favor insiders over the community, AO’s model adheres to the principles of fairness and equal access that are at the heart of the crypto revolution. There is no pre-sale or pre-allocation. Instead, the AO token reward mechanism incentivizes two key aspects of a successful ecosystem: economic growth and security of the base layer.

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