SpaceFuel

Reserve Accounts & Swap: How it Works

We expect the largest variations of supply to happen through Reserve Accounts. The supply of credits expands when a reserve account (such as the Space organization) sells hosting credits for a correlated outside crypto or national currency. Reserve Accounts have a special algorithm for expanding their credit limit by committing a Proof-of-Reserve record to their chain to demonstrate receipt of a payment in the accounts’ correlated outside currency for Space credits. The outside funds are then held in reserve for network hosts who receive credits from purchasers of their services. Any credits redeemed through a Reserve Account must have been earned for providing hosting, which can be confirmed by auditing hosts’ Proof-of-Service entries and transaction histories.

While Reserve Accounts may temporarily expand the supply, they only do so in response to increased demand. As hosts redeem their hosting credits, the supply decreases again. The expansion of the supply raises liquidity for hosts giving them an opportunity to cash out increasing perceived value.