Last updated: May 24th, 2021 11:45 PM CDT
Robonomics might be the most interesting blockchain technology that I have come across in the time I have been involved with cryptocurrency. It is an IoT (internet-of-things) ecosystem that decentralizes robotic commands. The project has been around since the launch of the Ethereum mainnet and they actually deployed a drone within a couple months of Ethereum’s launch. Like AWS (Amazon Web Services), RWS (Robonomics Web Services) provides a cloud where users can purchase subscriptions and build applications using tools that integrate their IoT apps into Ethereum. However, unlike AWS, RWS is totally decentralized and economic in nature.
The applications of this technology are endless and the project has published a nice little article going over possible use-cases. Some of these examples include drone fleet management, environmental monitoring, smart building management, power grid solutions, Mars colonization, self-driving car management, and even a robot named Gaka-chu that paints under the control of Robonomics.
Essentially if the device can be programmed then it can be integrated into the Ethereum blockchain with Robonomics.
The XRT Token
The RWS token is currently the only token powering the project. There are only 100 RWS tokens in existence and 1 of them entitles its owner to 1 tps (transaction per second) in perpetuity, but the issue that Robonomics is facing with Ethereum is scalability. The Ethereum network is not capable of facilitating more than 100 lifetime RWS subscriptions for 1 tps. This is the reason Robonomics is attempting to secure a parachain slot with Kusama and eventually Polkadot; the relay chain infrastructure allows Robonomics to issue a lot more subscriptions to their web services. An article published by the project last August mentioned a goal of issuing 6,000 monthly subscriptions for 1 tps, but an article published the following October mentioned 9,000 of these subscriptions.
This is where the XRT token comes into play. Spending 1 XRT entitles its owner to 1 tps for 1 month on RWS. Robonomics will implement a network limitation of 9,000 tps and burn any XRT spent by applications exceeding this network limit. Additionally, Robonomics has created something called a “Robobank” that will allow users to deploy IoT applications on RWS using other native parachain tokens.
XRT and RWS are both trading live right now and have proven market value. However, current prices are not indicative to what they will end up being since not all XRT tokens have been minted. The RWS token might be more price stable since its application has been around for a longer period of time but it is uncertain how its price will respond to the introduction of XRT and monthly tps subscriptions. All we know is that the market right now values a lifetime entitlement of 1 tps on RWS at ~$60,000.
The team has also mentioned the possibility of staking XRT but the specifics are yet to come.
The Crowdloan Reward
- < 1% of supply (< 100,000 XRT)
- 1 XRT:1 KSM ratio (up to 100,000 XRT)
- Assumed 48 week long lease (Robonomics has expressed a desire for a 2-year slot but the maximum allowed on Kusama is 48 weeks)
- 25% of XRT reward liquid on launch, 75% disbursed after Robonomics parachain launch (2–4 weeks after winning the slot)
- 50% annual return increase for staked XRT for 2 years
- Not competing for the first slot. Will compete for slots 3–6.
Please note that Robonomics has expressed they will compete for the 3rd-6th auction slots. Nonetheless I’ve decided to cover it since they are listed on parachain.live. Robonomics has decided to define a ratio to determine the reward to crowdloaners. This creates a natural cap at 1:1 which can get lower depending on the winning bid. Let’s see how the numbers play out with different potential outcomes:
Keep in mind that although the token ratio for Robonomics is lower than most other parachain offerings, the whole of the reward is available to crowdloaners just 4 weeks after winning the slot. These numbers also assume that none of the XRT reward gets staked. It is important to keep in mind that crowdloaners are essentially promised a 50% APR on their staked XRT which is a major benefit. Although there is an opportunity cost for not staking your KSM it will certainly balance out with the possibility of staking XRT.
The XRT token is among the very few parachain tokens that are live on the market right now. It has proven market value even before its full implementation and its future is very promising. Also, the whole of the crowdloan reward is disbursed very soon after the auction which is why I have given this a low risk evaluation.
The token ratio and reward ceiling that Robonomics has offered is quite limiting all around. If the winning bid is less than 100,000 KSM then crowdloaners get less than 1% of the total supply. If the winning bid is more than 100,000 KSM, the ratio gets worse. With XRT’s current price, the reward is modest at best which is why I think it gets a low evaluation.
The uniqueness of Robonomics is unmatched. If the project was wiped from the face of the planet it is unlikely that anything else could swoop in to replace it. The team has had their hands on Ethereum’s infrastructure since Ethereum went live and the experience they have building EVM applications is irreplaceable and priceless. The solutions RWS provides to the world are countless and are so integral to technological advancement that it could revolutionize robotic automation as we know it. For these reasons I believe it has a very high novelty.
While the XRT and RWS tokens are utilitarian in nature I do not foresee the average XRT holder using it for Robonomics subscriptions. NASA, Boston Dynamics, Boeing, Tesla, etc. will be the consumers of XRT while the common holders will regulate the price of XRT through trading and staking. XRT has great utility but since it occupies a small niche it gets a medium utility rating.