The Mynth network is a decentralized and self-regulating proof-of-stake ecosystem designed to prioritize user privacy and enable trustless execution of intents. With no slashing mechanism, Mynth ensures participants retain control of their staked assets without the risk of losing funds. Unlike traditional blockchain systems, Mynth does not maintain a ledger. Instead, peer enforcement and carefully structured reward incentives uphold network honesty and integrity. The network’s structure features key roles such as Lizard operators, MNT holders, swappers, and intent fulfillers, all of whom contribute to its decentralized functionality and reliability through incentive-driven interactions.

Licensing and Staking Requirements for Lizard OperatorsCopied!

Lizard operators are pivotal to the network, responsible for maintaining and operating the Lizard software. Their primary roles are to validate fact statements and aid in the execution of intents, ensuring smooth network operations and adherence to rules. To acquire a Lizard license, operators must meet the following requirements:

• Stake a minimum of 10,000 MNT tokens.

• Possess one Rare Chameleon NFT.

Mynth’s liquid staking ensures there is no locking. Lizard operators are financially incentivized to follow the network’s rules, as their ability to earn rewards directly depends on maintaining eligibility. Furthermore, they have a vested interest in the long-term success of the protocol, as its growth and stability benefit their continued participation and earning potential.

Operators who do not meet the minimum staking requirements lose eligibility to hold a Lizard license. Without a license, they lose the ability to join new Lizard factions, eliminating their ability to earn rewards.

MNT Staking and DelegationCopied!

MNT holders contribute to the Mynth ecosystem by participating in liquid staking, which allows them to stake their MNT with chosen Lizards while retaining access to their funds. Through this process, Lizard operators are delegated responsibility for enforcing network rules and representing MNT holders within the network. This setup also enables MNT holders to earn staking rewards. Even after delegating to a Lizard, MNT holders retain the ability to vote individually on governance proposals within the Mynth DAO. Rewards earned by Lizards are distributed among delegates in proportion to the amount of MNT they have staked, ensuring that those with higher stakes receive a greater share of the rewards.

Liquid staking enables MNT holders to support their selected Lizard’s operations while retaining the flexibility to use their tokens elsewhere. Rewards for Lizard operators are also partially weighted by the size of the MNT stakes they attract from other holders. This system encourages Lizard operators to earn the trust and delegation of MNT holders by demonstrating consistent and effective performance.

The integration of reward sharing, operational accountability, and accessible staking fosters collaboration between MNT holders and Lizard operators, ensuring effective and decentralized network management.

Work Verification and Reward DistributionCopied!

Mynth’s reward distribution system operates through reward slots, which occur every x hours. During each reward slot, participants in the ecosystem can submit evidence of completed swaps. This open submission process is available to all participants, including individual Lizard operators, who are motivated by the opportunity to earn rewards. By encouraging broad participation, the system remains competitive and decentralized.

Evidence Submission and Verification

To validate completed swaps, participants submit proof of intent fulfillment. This proof consists of an emptied swap address, requiring both a deposit and a withdrawal transaction to validate the swap. Using a blinded private key and a Lizard faction's public key, a blockchain address can be derived. If the derived blockchain address matches the emptied swap address, this confirms that a Mynth swap has been successfully completed.

Reward Slot Selection

At the end of each reward slot, all submitted evidence is aggregated to generate a seed. This seed is used to produce a random number, which determines a swap randomly selected from the collected evidence. The Lizard faction responsible for this selected swap is declared the winner of the reward slot. This process ensures fairness and unpredictability in the selection of reward slot winners.

Incentives for Faction Participation

The winning faction earns the associated rewards, distributed among all Lizards in the faction. This incentivizes Lizard operators to join multiple factions, increasing their probability of being part of a randomly selected faction and, consequently, their chances of earning rewards.

Privacy and Uniform Compliance

Mynth's privacy features mean that not all swaps are recorded; as a result, not all swaps contribute to the reward slot. However, since Lizards cannot determine which swaps will be recorded and which will remain private, they are incentivized to adhere uniformly to all network rules. Furthermore, the timing of reward slot selection is unpredictable, as Lizards cannot know which swap will be chosen for rewards or when it will be selected. This unpredictability further reinforces consistent compliance with network rules.

Peer Accountability

Factions are collectively held accountable by their members. Misconduct by a single Lizard can lead to the entire faction forfeiting its reward slot. This dynamic creates an incentive for factions to monitor their members and exile those who jeopardize the group’s performance and integrity.

Blacklisting Misbehaving Lizards

Honest behavior is essential in the Mynth network to ensure proper intent fulfillment and user safety. Two main user groups depend on reliable Lizards:

1. Swappers: Users initiating swaps who expect fast and reliable service.

2. Intent Fulfillers: Participants completing swaps who need assurance that wallets will be unlocked promptly.

If Lizards act dishonestly or inefficiently, users have the ability to blacklist them. Blacklisting carries significant ramifications, as it impacts not just the individual Lizard but also their entire faction. Factions associated with blacklisted Lizards are likely to see fewer swap requests, directly reducing their reward potential.

To mitigate risks such as reduced rewards and loss of reputation—which is vital for attracting MNT stakers—factions are incentivized to self-regulate by exiling and blacklisting underperforming or dishonest Lizards. This process helps factions maintain their competitiveness and ability to attract swap requests, ensuring the network’s reliability and discouraging misconduct among participants.

Security and Incentives for Honest BehaviorCopied!

Mynth’s architecture effectively disincentivizes malicious behavior by:

• Imposing economic penalties on misbehaving Lizards, such as the risk of exile and forfeiture of potential rewards.

• Requiring active participation costs, which discourage exploitation of the network without contributing.

These built-in disincentives, combined with user and peer accountability, foster an environment where the majority of Lizards are motivated to act honestly. By aligning incentives with honest behavior, the Mynth network promotes stability and reliability.