Tokenomics FAQ: DIVX to DIVI Redemption

By now, most of those reading this post know that the DIVX to DIVI token redemption period will begin on June 25th, 2018 but there are still questions surrounding how this process will affect the current and future tokenomics of the ecosystem.

Why is DIVX being redeemed for DIVI?

DIVX is an ERC-20 placeholder token that was used to raise funding to develop and market the official DIVI blockchain, releasing on June 25th, 2018.

Will DIVX become obsolete?

The exchanges will eventually delist the DIVX ticker, and it will no longer be available for trade.

How long do I have to redeem my DIVI?

We do not currently have a time limit on the redemption period. We understand that some people may not be following the project as closely as others and have their own lives and responsibilities that may interfere with their knowledge of the redemption. This is especially true because we are launching during the Summer.

Where does the redeemed DIVI come from?

The total supply of 6,171,607 DIVX will be included in the DIVI genesis block at a rate of 1:100 as voted by our community. This will result in a genesis block containing 617,160,700 DIVI.

This will not, however, be included in DIVI's circulating supply until a user goes through the redemption process.

The genesis wallet will be publicized and viewable by anyone for full transparency and the DIVI will remain there until they are either all redeemed or governance votes to end the redemption opportunity.

Why not generate the tokens each time someone goes through the redemption to keep supply low?

We have to start with an identical supply (x100), otherwise there will be an enormous disparity in value between DIVX and DIVI.

What happens to the DIVX that has been redeemed?

When users redeem their DIVI for DIVX, they are calling a function within the DIVX smart contract called redeem.

The function looks like this:

function redeem(bytes32 diviAddress) external {
  require(isRedeeming);

  uint256 divxVal = balances[msg.sender];
  require(divxVal > 0);

  assert(super.transfer(fundDeposit, divxVal));

  LogRedeem(msg.sender, divxVal, diviAddress);
}

The function requires that the team turn on the isRedeeming function, which starts the process and allows users to call redeem.

What the above does is redeems the DIVX tokens and records the address that the sender created in the DIVI blockchain. It then finds how much DIVX the user holds, and moves the DIVX to an address from which the tokens can be burned.

Once a week we will hold a token burn event where we will send the redeemed tokens to 0x0000000000000000000000000000000000000000, which is a nonexistent, completely inaccessible Ethereum address.

For KYC requirements, see:
https://blog.diviproject.org/divi-kyc-aml-redemption-faq/