Io.net (IO) Staking Program Garners $1.5 Million Within a Week, Deebs DeFi Predicts Supply Shock

Recently, Io.net (IO), a project focusing on the decentralized physical infrastructure network (DePin), announced its staking program. Within just a week, the newly launched program has successfully garnered around $1.5 million.

Io.net (IO), a decentralized physical infrastructure network (DePin), has announced its staking program, garnering around $1.5 million within a week. This initiative aims to enhance network security and efficiency by requiring GPU and CPU suppliers to lock in a specific amount of IO tokens.

According to data from Solscan, this effort to incentivize Graphics Processing Units (GPU) providers through staking has secured approximately 654,940 IO tokens. The program sets a minimum stake of 200 IO per card, with higher-earning devices requiring increased stakes.

For instance, a device with eight H100 GPUs, each boasting an earning multiplier of 10, would need to stake a substantial 16,000 IO. In contrast, a device with four 4070s GPUs, each carrying a multiplier of 0.25, would only require staking 800 IO.

“By requiring suppliers to stake IO, we can encourage long-term commitment to our platform and also create an incentive for good behavior,” io.net explained.

Each supplier's device operates under its dedicated smart contract, ensuring the security of staked IO tokens. Block rewards are also distributed fairly and transparently, accruing to the Solana wallet address linked to the supplier's account and available for periodic claiming.

Upon initiating the unstaking process, a 14-day cooling-off period commences, during which IO tokens are no longer counted towards the minimum staking requirement for availing block rewards. This cooling-off phase is crucial for maintaining network stability and integrity, preventing potential exploitation of the reward system.

The DePin platform Io.net has also implemented a slashing protocol for actions like spoofing or data compromise. “Slashed IO is subject to a one-month reconsideration process. If you notice your device stake is slashed, you can open up a support ticket. IO support will present technical evidence that proves why the device was identified for spoofing or other malicious behavior,” io.net stated.

Pseudonymous DeFi analyst Deebs DeFi suggests that this staking update could lead to a supply shock, potentially rendering 10% of the circulating supply of IO tokens practically unusable. According to Deebs DeFi's calculations, GPU providers could generate a purchase volume approaching $17 million.

“This is based on the assumption that all providers buy and stake the minimum IO they need,” Deebs DeFi noted.

This development is reflected in the price action of IO tokens, with IO being up over 30% in the past seven days at the time of writing. Anticipation is also building for Nvidia's upcoming quarterly report on August 28, which could impact AI and DePin tokens.

However, the DePin token itself has faced challenges, shedding about 65% of its value from its peak in June. There are also concerns about potential sell-offs as new supply enters the market. While the circulating supply of IO tokens is just 95 million, its maximum supply stands at a massive 800 million.