Learn about Siafunds
Overview: Siafunds
Siafunds serve as tokens utilized for revenue sharing within the Sia network, wherein a 3.9% fee from every storage-related transaction on the Sia platform is allocated to Siafund holders. Roughly 1,400 Siafunds were initially distributed to investors through securities sales, while Skynet Labs presently holds the remaining ~8,600 Siafunds.
When contractually completed on the network, 3.9% of each funding source, including renter fees for storage, renter bandwidth costs, and host collateral, is earmarked for Siafund holders. The reserved amount is equitably dispersed upon contract completion among all Siafund holders.
The creation of Siafunds was driven by the goal of establishing a sustainable means of funding the development of the Sia network. These tokens incentivize and empower both ourselves and investors to actively support and enhance the Sia network by capturing a portion of its growing revenue. As the user base expands and more users pay for storage, Siafund revenues increase, providing additional resources for developing Sia-supported software.
Siacoins vs Siafunds
Utility tokens, such as Siacoins, primarily gain value through their utilization on a blockchain platform. In contrast, Siafunds derive their value from both the current and anticipated worth of the Sia storage network.
Limited Supply
The maximum number of Siafunds that will ever be issued is 10,000, and all of these were generated at the launch of the Sia software in 2015. Given that the quantity, size, and value of contracts on the Sia network are rising, the revenue per Siafund increases proportionally as the number of issued Siafunds remains constant.
Initially, Nebulous, Inc. held all 10,000 Siafunds. However, they have conducted multiple Siafund sales to support development. In 2021, Nebulous rebranded as Skynet Labs and still retains approximately 8,600 Siafunds, while the rest have been distributed to third parties.
How to obtain Siafunds
Siafunds are typically unavailable on mainstream exchanges due to their classified securities by the SEC under United States laws in 2018. This classification makes most exchanges unwilling to comply with the requisite regulatory requirements for trading in securities. If you are in the United States, you may need to qualify as an accredited investor to engage in Siafunds transactions.
We strongly advise researching the relevant securities regulations in your country before considering buying or selling Siafunds and seeking legal counsel for guidance in this matter.
Siafunds are typically bought and sold through the #siafunds channel on the Sia Discord server, where over-the-counter trades are safely facilitated with the assistance of Embarcadero, an escrowless Siafund/Siacoin swap developed by the Foundation.
How to store Siafunds
Siafunds are stored in your Sia-UI wallet, right next to your Siacoins.
You can also send and receive Siafunds to and from standard Siacoin addresses, and they can be recovered using your Siacoin balance as long as you possess your Sia seed.
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