Introduction

In this article, we explain a key concept related to the Enjin Relaychain and Matrixchain: the Existential Deposit (ED).

To better understand this concept, it is important to first define some terms:

• Existential Deposit (ED): This is the minimum balance an account must maintain to stay active.
• ENJ: This is the token used in the Enjin Relaychain / Relaychain.

What is the Existential Deposit?

The Existential is 0.1 ENJ.

Impact of the Existential Deposit on Account Balances

When an account's balance falls below the Existential Deposit, any remaining ENJ tokens are destroyed. This might seem counterintuitive, so let's explore this with an example:

If a wallet on the Enjin Relaychain with 1 ENJ transfers 0.93 ENJ to another wallet, it would, under normal circumstances, have 0.07 ENJ remaining. However, because 0.07 ENJ is below the Existential Deposit, the remaining balance for that account on Enjin Relaychain is reset to 0 ENJ.
The same applies to the Enjin Matrixchain. If an account's balance falls below 0.1 ENJ (the Existential Deposit), the remaining ENJ for that account on Enjin Matrixchain are destroyed and the balance is reset to 0 ENJ.

❓Please note, the Existential Deposit rule does not affect MultiTokens (also known as Collectibles or Assets). If an account's ENJ balance drops below the Existential Deposit, only the ENJ balance is reset. The MultiTokens in that account remain unaffected.

Why is the Existential Deposit Needed?

The Existential Deposit serves a critical function in preventing the blockchain from becoming "bloated" with accounts carrying very small balances. By imposing a minimum balance, the network can maintain high performance and reduce fees, making it a more efficient and cost-effective platform for all users.