Ore

Mining Round Mechanics:

Each mining round lasts about 1 minute. Miners can deploy SOL on any squares within a 5x5 Grid. This can be done manually, or through automining/bot feature (where users can automate their deployment setting to continue mining over multiple rounds).

At the end of each round, 1 winning square is selected using a secure random number generator on Solana.

SOL Deployment:

All SOL deployed every round will be taxed 1% as Admin Fee. This is collected by the ORE team for development/operations of ORE Protocol.

Of the SOL deployed on the losing squares:

(a) 10% of SOL deployed on the losing blocks is captured by the protocol (vaulted) as revenue

-> 90% is used for open market buyback and burn of ORE token. If buybacks exceed the emission of 1 ORE per round, ORE supply becomes deflationary.

-> Remainder 10% will be distributed to native ORE stakers as staking yield.

(b) Remaining 90% of SOL deployed on the losing squares is distributed to winning miners in proportion to their SOL deployed on the winning square.

ORE Rewards:

In addition to SOL winnings for winning miners, the protocol mints 1.2 ORE/round.

(a) 1 ORE rewards will be distributed to miners on the winning square, in proportion to their SOL deployed on the winning square. There is a 50% probability that this entire 1 ORE reward will be randomly given out entirely to 1 winning miner on a weighted random chance.

b) 0.2 ORE rewards minted/round will be allocated into a Motherlode pool which accumulates over time. Each round has a 1/625 chance of triggering the Motherlode. When triggered, the pool is distributed among winning miners, in proportion to their SOL deployed on the winning square

All ORE rewards are initially issued as unrefined ORE (pre claim) which is non tradeable.

As such, Production Cost (Cost/ORE) = Total Admin Fee Paid + Total Protocol Revenue (10% Fee on the SOL deployed on losing block).

Claiming of Mining Rewards (Refining):

When a user decide to claim their ORE (process of claiming is known as refining), there is a 10% refining fee applied to these unrefined rewards. This fee is redistributed to other miners, proportional to their unrefined ORE balances. Redistributed rewards are added to the refined ORE pool of unclaimed miners.

This redistrbution of ORE mining rewards serves as an incentive for miners to hold their unrefined ORE and redistribute rewards from short term to long term holder.

The yield earn from the 10% tax is defined as Refining APY.

When a user claims, the payout they will receive = 90% * Unrefined ORE (Mining Rewards) + 100% Refined ORE ( from redistribution/refining fee).

Production Cost:

Production cost represents the SOL cost incurred per ORE minted (the effective cost for miners to produce/mint 1 ORE)