Magnolia (MGN) Tokens FAQ – Gnosis

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MGN Tokens Overview

  • Magnolia (MGN) is an ERC-20 token intrinsic to the auction-based DutchX trading protocol.
  • You can generate MGN tokens by trading on the DutchX protocol.
  • MGN tokens are locked by default in the DutchX MGN Contract but are associated with your wallet address.
  • Locked MGN tokens have two primary utilities: 1) Reducing fee-like contributions on the DutchX trading protocol; 2) Earning Reputation (voting power) in the dxDAO until June 28th, 2019 at 12noon GMT. 50% of all Reputation will be allocated to those who have registered MGN.

Magnolia (MGN Frequently Asked Questions)

What is Magnolia (MGN)?
Magnolia (MGN) is an ERC-20 token intrinsic to the auction-based DutchX trading protocol.

How do you generate MGN?
As of May 29th, 2019, 1 MGN (or a fraction thereof) is generated from trading the equivalent of 1 ETH of any whitelisted token pair auction on the DutchX trading protocol. Currently, there is no mechanism in place to reduce the total MGN supply.

How can you trade on the DutchX trading protocol?
Command Line Interface (CLI): https://dutchx.readthedocs.io/en/latest/cli.html
Seller Interface: https://slow.trade
Bidder Interface: https://fairdex.net

Are there other ways to get MGN?
MGN is an ERC-20 token and tradable when unlocked. (When they’re generated, by default MGN tokens are locked.) Currently MGN tokens are not listed on any exchanges, but exchange listings and secondary markets could occur.

How do you know you’ve generated MGN?
MGN tokens are automatically assigned to the user’s wallet address when a qualifying trade is completed, and are locked by default. This means that until MGN tokens are unlocked, you can’t use MGN tokens in transactions, and they won’t appear in your wallet address.

Your locked MGN balance is visible on the Seller Interface (https://slow.trade), Bidder Interface (https://fairdex.net), and dxDAO Vote Staking Interface (https://dxdao.daostack.io/stake-for-your-vote). MGN tokens must be locked for its two primary utilities to be active.

What are MGN tokens good for?
MGN tokens have two primary utilities. However, importantly, MGN tokens must be locked for its two primary utilities to be active.

  1. Lowering Liquidity Contributions on the DutchX trading protocol
    Instead of fees, the DutchX trading protocol levies Liquidity Contributions of less than or equal to 0.5% of a participant’s total trading volume. Participants holding MGN tokens can lower their individual Liquidity Contributions. For more details on Liquidity Contributions, please consult the question below, What are Liquidity Contributions on the DutchX trading protocol?
  2. Earning Reputation (voting power) in the dxDAO
    The greatest amount of initial Reputation (voting power) in the dxDAO (50%) will be given to participants who register their MGN tokens. The dxDAO will govern parameters on the DutchX trading protocol via proposals, which only those who hold Reputation (voting power) can vote on. For more details on the dxDAO, please consult the dxDAO announcement post.

How do you use MGN tokens to earn Reputation (voting power) in the dxDAO?
To earn Reputation by using MGN tokens, you must make sure you are aware of the following:

  • You have registered a wallet address that is associated or will be associated with Magnolia (MGN) tokens on the interface here https://dxdao.daostack.io/stake-for-your-vote. You can do so by clicking REGISTER and confirming the transaction. See the full walkthrough here.
  • You can register at any time before June 28th, 2019, 12noon GMT.
  • MGN tokens will only be counted during the last 24 hours of the Vote Staking Period (27 June 2019, 12noon GMT to 28 June 2019, 12noon GMT). It cannot be guaranteed during the 24 hours specifically when the MGN tokens will be counted, so you should have the total balance of locked MGN tokens associated with the registered wallet address during the entire 24 hour period.
  • If you are registering a wallet address associated with MGN tokens during the last 24 hours of the Vote Staking Period (27 June 2019, 12noon GMT to 28 June 2019, 12noon GMT), you should be sure to have the MGN tokens associated with your wallet address at the time of registering.
  • MGN tokens associated with the registered wallet address must be locked in the DutchX MGN Contract, or they will not contribute toward your Reputation Score.

In summary, MGN tokens must be registered on the interface (https://dxdao.daostack.io/stake-for-your-vote), and meet the criteria during the last 24 hours of the Vote Staking Period (27 June 2019, 12noon GMT to 28 June 2019, 12noon GMT) of:

  1. Being associated with the registered wallet address;
  2. Being locked in the DutchX MGN Contract.

If you have MGN tokens, will they automatically earn your Reputation (voting power) in the dxDAO?
No. MGN tokens must be registered on the interface (https://dxdao.daostack.io/stake-for-your-vote), and meet the criteria during the last 24 hours of the Vote Staking Period (27 June 2019, 12noon GMT to 28 June 2019, 12noon GMT) of:

  1. Being associated with the registered wallet address;
  2. Being locked in the DutchX MGN Contract.

How do you know if your MGN tokens are locked in the DutchX MGN Contract?
Your locked MGN balance is visible on the Seller Interface (https://slow.trade), Bidder Interface (https://fairdex.net), and dxDAO Vote Staking Interface (https://dxdao.daostack.io/stake-for-your-vote).

Does the dxDAO locking tokens function relate to locking MGN tokens?No, they are not related. When they’re generated, by default MGN tokens are locked in the DutchX MGN Contract. They must be locked in this contract to contribute toward your Reputation Score. MGN tokens cannot be locked on the dxDAO Vote Staking Interface.

What are Liquidity Contributions on the DutchX trading protocol?
Instead of standard fees, the DutchX trading protocol levies Liquidity Contributions of less than or equal to 0.5% of a participant’s total trading volume. Liquidity Contributions do not go to an operator or owner, rather they are reinvested in the next auction of the token pairing to contribute liquidity, benefitting all traders who participate in the following auction. Participants holding MGN tokens can pay lower Liquidity Contributions, based on the percentage of the total volume of locked MGN tokens they hold according to a step function pictured in the figure below. Further details on the Liquidity Contribution reduction model are available here.

MGN tokens are automatically locked. How can you unlock and transfer them?
When they’re generated, by default MGN tokens are locked in the DutchX MGN Contract. This means you can’t use MGN tokens in transactions until they are unlocked.

An interface to lock and unlock MGN tokens will be made available in the coming weeks. If you wish to unlock your tokens, currently you must do so by interacting directly with the smart contracts. The process to unlock MGN tokens can be initiated at any time, and after the process to unlock MGN tokens is initiated, the tokens will unlock in 24 hours. During this 24-hour period, the MGN tokens cannot be used for paying lower Liquidity Contributions or earning Reputation in the dxDAO. This is to prevent misuse of MGN tokens utility, which is detailed further below. The process to relock MGN tokens has no in-built time delay.

After MGN tokens are unlocked, you can transfer them like any other ERC-20 token. However, importantly, MGN tokens must be locked in the DutchX MGN Contract for its two primary utilities to be active.

Why would you want to transfer MGN tokens?
For MGN tokens’ two primary utilities, you do not need to transfer MGN tokens.

However, there may be a few reasons why you’d want to transfer MGN tokens to a different wallet address, such as:

  • If you have participated in trading with multiple wallet addresses on the DutchX protocol, you may want to consolidate your MGN tokens in one wallet address so that you can pay an even lower amount in Liquidity Contributions on the DutchX trading protocol.
  • You may want to use a different wallet address from the one you’re using to trade on the DutchX protocol to participate in the dxDAO Governance Phase. For example, you may want to transfer your MGN tokens to a Gnosis Safe wallet, and register MGN from that wallet address on the dxDAO Vote Staking Interface.

Can I unlock only part of my MGN balance?
No. Only the full balance of MGN tokens assigned to a wallet address can only be unlocked at any time. However, you can transfer a partial sum of unlocked MGN tokens to another wallet address, and then relock the remaining MGN tokens balance.

Additional Resources
DutchX Smart Contract Architecture
MGN Proxy Contract on Etherscan
MGN Logic on Etherscan
dxDAO Dashboard by Dune Analytics

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