# CUNP Value Model
The value of CUNP comes from the CUN network effect. By bringing together all the institutions and individuals around the world who wish to do business on blockchain via CUN, they voluntarily provide services and access services based on CUN, and form a global on-chain market matched by CUN. CUN eco-services will be developed in parallel in the three stages of CUN evolution. In the early stage, the operation team will develop some CUN-based network applications to better support the eco-development. In the later stages,operation team will gradually focus on the network development and ecosystem construction. CUNPs provide an important basis for distribution. On the one hand, CUN generates a limited amount of CUNPs on demand to award contributors. On the other hand, the applications operating on CUN network and profits generated assign value to CUNP. In theory, the value of CUNP will increase as the number of users, assets and trading volume on CUN increase.
# CUNP Generation
In the first stage of CUN(Origin Network), the ecological participants of CUN include community supporters, CUN operation team, validating nodes, DAOs and blockchain technology believers. CUN will generate a certain number of CUNPs to record the contributions of community supporters, validating nodes, operation team, as well as to motivate early users and application developers. For the long-term sustainable and stable development of CUN, the CUNPs generated in this stage is only of a minimum value in the total amount. In the second stage of CUN(Cape of Good Hope Network), the network will generate a certain number of CUNPs to record the contributions of community supporters and validating nodes: to stimulate the network transition and due to the increase in the number of validating nodes, the amount of CUNPs generated for the validating nodes increases by 50%, as shown in formula (4). After the network switching, a staking incentive pool is generated to encourage CUNP holders to participate in the network governance voting. If the number of CUNPs that have obtained governance right by staking is N, the CUNPs generated in the staking incentive pool will be N * 12%. These CUNPs will be transferred to stakers on a daily basis based on the proportion of staking quantity (as shown in formula (5)). To stimulate the ecological development, the CUNPs generated in this stage is ten times as much as the CUNPs of the foundation. They will be automatically transferred to the dedicated address of the foundation.
C1 and C2 in formula (4) refer to the quantities of CUNP rewards available to the first-stage and second-stage validating nodes, and the 50% rise parameter can be adjusted dynamically according to the actual situation.
In formula (5), C refers to the CUNP rewards that the staker can get in the incentive pool; N refers to the total amount of CUNPs having obtained the governance right by staking; a and b refer to the number of CUNP staking days and the proportion of CUNP staking in the incentive pool; p_1 and p_2 refer to the number days and the weight of staking proportion (which can be adjusted dynamically). The rewards received from the incentive pool are in direct proportion to the staking time and ratio of CUNP. Theoretically, the number of staking incentive pool expands with the increasing staking quantity of CUNP. More CUNPs can be acquired as a result of the relatively small number of early stakers. Subsequently, the proportion of staking incentive pool distributed to each CUNP is on the decrease with the increasing number of staking CUNPs. All the released CUNPs will participate in the staking in theory and the APY earnings will be stable at 12%. However, the incentive part generated by staking cannot be staked repeatedly within 90 days after being extracted so as to prevent the system stability from being destroyed owing to the obtainment of compound return. In the third stage of CUN(New Generation Network), users will have accumulated a lot of CUNPs from participating in the early network governance, the network upgraded to the improved consensus algorithm of POS + BFT, and the Mainnet accumulated a large number of users and become more decentralized with verified security. In addition to community supporters, CUN operation team, validating nodes, DAOs, blockchain technology believers, the participants of CUN ecosystem also contain many mature CUN network application providers, including but not limited to the asset generation, exchange and management based on CUN standard. Most of the CUNPs will be generated in Cape of Good Hope Network and New Generation Network to record the contributions of relevant parties to CUN development: node maintenance contribution accounts for 45%, business contribution accounts for 20%, eco-fund accounts for 10%, community supporters account for 10%, and the CUN operation team accounts for 15%. CUNP holders are entitled to participate and vote in the nodes election campaign by staking CUNP. The voting will be carried out according to the principle of "voting weight by person: voting weight by the number of holding CUNPs = 6:4" to weaken the influence of mine pool and ensure the decentralized nature of network，but each CUNP staked still is entitled to have the full right of yields. To ensure the stability of the CUN economic model and to avoid the exponential generation of CUNPs through repeated stakings of CUNPs, it will take 90 days before all additional CUNPs generated through staking can be withdrawn and circulated again. After the listing on DEX, the CUNP incentives to CUN operation team will be generated and released linearly over 12 months; the CUNPs generated in the eco-fund will be 1/10 of the number of CUNP in circulation, and will be automatically allocated to the dedicated address of fund. In conclusion, CUNP generation follows the on-demand principle, and the total quantity will not increase until it reaches 1 billion. The generation rules of CUNP take into account the contributions of operation team, nodes, governance, ecological fund as well as the business contribution after the launch of Mainnet. CUN network encourages long-term behavior rather than short-term speculation until the application ecosystem becomes prosperous and all CUNP holders are greatly fed back. To stimulate the network upgrading, CUNP incentive parameters are taken into consideration every time when getting into the next stage. In the CUN origin network , CUNPs are generated as shown in Figure 6.
"Figure 6. CUNP generation in Origin Network"
# Governance and Staking
The governance principle of CUN is to keep CUN in a healthy and steady development, make on-chain ecosystem play a valuable role to the digital economy, ensure that users can enjoy services provided by the CUN ecosystem, and all stakeholders can get due benefits according to the distribution principle of blockchain economy. Considering that the CUN consensus mechanism is divided into three stages of PoA, PoA+PoS and PoS+BFT, the governance mechanisms are somewhat diverse in different stages. In the three stages of CUN networking, as a necessary component of CUN governance, a certain number of CUNPs need to be staked for the validating node and can be released when it no longer serves as the node. The corresponding staking quantities are: 5000 in the first stage, 10000 in the second stage and more in the third stage (the staking quantity will be determined by community vote). Except for the first stage, corresponding staking will be rewarded with additional CUNPs. Just like air and water, the Internet is open and equal to everyone as an infrastructure. CUN does not set restrictions on applications to avoid making irrational and unfair decisions due to personal likes and dislikes under a specific environment. Although validating node is the mainstay of network, it cannot stop anyone from entering the network. On the contrary, given that there may be some validator node problems, the validator mainly stakes his own identity in the first and second stages of the network, putting the network operation under the supervision of all users. And then in the third stage, the validator will stake his own assets. When the validator cannot support the network operation, the system will deduct part of the staked CUNPs as a punishment.