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SKALE Network Launch Update

by Collin MyersAugust 21, 2020
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UPDATE: For up to date instructions on the SKALE launch on September 3rd, please see the SKALE Sale Guide.


  1. Our goal remains helping the SKALE Network achieve a successful public network launch with a wide and efficient token distribution

  2. Shortly before the scheduled auction on Monday, August 17, we observed overwhelming traffic and bot activity that would have led to a launch that failed to meet our standards of success

  3. The interest in the auction was more than 10x the auction’s capacity

  4. Our platform would have provided inconsistent user experiences and likely allowed only a small fraction of our registered users to successfully purchase SKALE tokens

  5. Our system was able to detect the problems early and we decided to proactively postpone the auction and are now revising our process

  6. Our new process will not include an auction and will provide all qualified users an equal and guaranteed allotment of SKALE tokens at a fixed price 

  7. The maximum sale proceeds will remain unchanged — our goal is to distribute the token to a broader user base not accomplish a larger sale 

  8. We will announce our launch date and detailed plans by Wednesday, 8/26/2020

We want to sincerely apologize to and reassure everyone who was impacted by our decision to postpone the SKALE Network auction on Monday. But before getting into more details about what happened, what we’re doing, and what’s next, we first want to reiterate our mission to make abundantly clear that our overriding goal is to help the SKALE Network achieve a successful public launch with a wide and efficient token distribution to users who will become valuable, active contributors to the network’s success.

Our mission

ConsenSys’ mission is to build the decentralized world wide web on a maximally decentralized base trust layer. We envision a more equitable society with broader ownership and more “positive sum” collaboration, and we believe that networks like SKALE are an important part of that future. They use positive-sum collaboration among token-holding network participants to deliver their respective piece of a scalable decentralized future.

It is still early days, but one thing we know is that launching these networks successfully is hard. It’s even harder when your definition of “success” is not merely the number of “tokens sold” or “money raised.” Our goals are fundamentally different and much more ambitious. 

Activate’s design goal is to help networks “activate,” among other ways, by enabling them to launch their tokens to as many excited, informed, capable and active network participants as possible. We firmly believe that networks can only decentralize and become successful if their participants are distributed and active.

With the SKALE Network, our paramount goal remains the same: to help broadly distribute tokens to as many users as possible who have demonstrated an ability and intent to become valuable network participants through delegation, validation, or by running a SKALE chain for their dApp. 

What happened?

On the morning of the auction, just hours before the scheduled launch, we observed extremely high amounts of site traffic, attempted pre-auction bids, and aggressive bot-like behavior. This strained our systems and provided inconsistent user experiences. Thankfully, our security mechanisms kicked into gear, stopping any “frontrunning,” warding off nefarious attacks, and successfully informing us of the emerging issues so we could proactively avoid a launch that would not have been successful by our standards.

In particular, if we had forged ahead it is highly likely that only a small number of users would have quickly purchased the full allotment of SKALE tokens. Interest in the auction was more than 10x the available capacity, and successful purchasers in the auction would have represented only a miniscule fraction of our 12,000+ registered users who indicated interest in the SKALE Network. Worse still, that tiny fraction of auction buyers would have disproportionately been powered by bots and not our platform. 

That might have satisfied a goal of “selling tokens,” but it wouldn’t have achieved our goal of a broad token distribution to users who would likely become valuable participants in the SKALE Network. Over 5,000 users completed a rigorous onboarding process that required them to pass KYC and demonstrate an ability and intent to use the SKALE Network. Turning away these users just because they were not as proficient as others in bypassing our purchase flow seemed neither fair nor in the best interests of the SKALE Network.

How are we addressing these issues?

After careful deliberation, we see no viable short-term solution to hosting an auction. The issues with auctions in this market are well known as other recent auctions have felt similar pain in terms of demand, load, and performance bottlenecks. 

All of those difficulties are amplified in light of our goal of prioritizing “activation” of the SKALE Network over merely selling tokens. And it is not in the best interest of Activate users or the SKALE Network to delay long enough to change the auction logic to achieve a more distributed group of token holders. As a result, we have decided against an auction.

We will instead implement a token distribution process that allows as many qualified users as possible an equal opportunity to purchase a guaranteed allocation of SKALE tokens at a fixed price. We are not changing the maximum sale proceeds; our goal is distribute the token to a broader user base, not to capitalize on the overwhelming interest to increase proceeds of the sale. We believe this is the best method of successfully distributing tokens to a wide pool of users who will become valuable participants in kickstarting the SKALE Network. 

This approach presents tradeoffs. The only way to provide so many users with an equal opportunity at a fixed price is to significantly reduce the maximum purchase of many users. To do this as quickly as we intend, we must accept that the limits will be imprecise. We are evaluating several ways to mitigate these tradeoffs and will include more details when we announce the new launch date next week.

Who is eligible to participate?

In short, we intend to make the distribution equally available to each and every Activate user who already completed the steps necessary to onboard and demonstrate the ability and intent to become active and valuable participants on the SKALE Network.  

Specifically, all registered users who have successfully completed the below steps before the original date and time of the auction will be eligible to participate: 

  1. Successfully passed KYC

  2. Successfully passed the SKALE Quiz

  3. Submitted their purchase intent 

If you have completed the above registration steps but are awaiting approval of your fully-submitted KYC or purchase intent through our manual review, you do not need to do anything else at this point. We will be completing the review of pending applications by the end of this week.

Who is not eligible to participate?

If you are a new user or have not completed and successfully passed all registration steps mentioned above, you will not be eligible to participate in the initial SKALE launch. If you submitted incomplete or incorrect KYC information, you will not be eligible to participate in the initial public launch of SKALE on Activate.

After a temporary pause, we will re-open new user registration for Activate’s staking services and future network launches. While this does not allow you to purchase SKALE tokens in the initial launch, you can use the Activate platform in the future to stake SKALE tokens you might obtain after this launch. Additionally, you are eligible to participate in other future network launches that use the Activate platform.

When will the new launch date and details be announced?

Our new distribution plan requires some additional engineering work, but we are committed to executing as quickly as possible with the highest standards of reliability. We are in the process of locking in timelines with confidence, and we will announce the new date of the SKALE token distribution on or before Wednesday, August 26th. We will include details and instructions as to how to participate at that time.