GSR or Global Share Rate, is the number used to calculate how many shares we give you when you stake.
The principle behind Axion’s staking system is to lock the Axion amount for a period of time and convert it into Shares. These Shares are used to calculate your daily interest and rewards over the staking period.
When people talk about the Share Rate, they are most likely talking about the Global Share Rate, as defined in the glossary:
Global Share Rate (GSR): The share rate of the Axion token that converts Axion into Shares during the staking process. The higher the share rate, the fewer shares you receive when you stake.
This rate only ever increases and will never decrease. This way, the people who stake today will always get a better share rate than the people who stake tomorrow.
When creating a stake, you will see a Share Rate number as highlighted below.
This number started at 1.00 and slowly rises each day. Basically, creating a stake earlier gives you more shares than people who stake at a later date.
The amount of Basic Shares is calculated by dividing your principal amount to stake, by the Global Share Rate.
Principal / Share Rate = Basic Shares
1,000,000 / 1.1352 = 880,876
So in the example above, a stake of 1,000,000 AXN gets you 880,876 Basic Shares.
Once you create a stake, you are essentially locked in at that Share Rate... as you have traded your AXN for a number of shares based on that GSR.
The rest of your shares are made up of the Longer Pays Better bonus. The longer you stake, the more LPB shares you get. Total Shares = Basic Shares + LPB.
This factor is used to control inflation such that the number of shares for a new stake is reduced over time, by increasing the global share rate factor a small amount every day.
It also encourages people to get their long stakes in as early as possible, as they earn more shares by doing so.
A new global share rate update procedure was introduced on February 15th 2021 with a start value of 1.09 and with the current rate of change, an estimate as shown below gives the global share rate value of 1.55 and 2.22 for stakes that start one and two years later.
The Global Share Rate is actually measured to 16 decimal places, but we only display it to 4 decimals on the staking platform.
Anyone who double-checks my math earlier in this article may notice that 1,000,000 / 1.1352 doesn't really equal 880,876.. it actually equals 880,902. In reality, the real GSR for that example is 1.1352331872897434.
1,000,000 / 1.1352331872897434 = 880,876.291493.
That is how many Basic Shares you would actually be assigned.