Disclaimer: The blog was updated on 28.01.2026, adjusting the time window for Pool 1 rewards eligibility from February 1-April 30 to February 10 - May 10.
New year, new phase — Phase 2 of rewards for early krest adopters is here. With it, begins the wind-down of support for the network from its core team. To facilitate a migration to peaq for the remaining krest users, the krest team has requested 1 million PEAQ from the Peaq Foundation, and this request has been approved. None of the rewards, including both Phase 2's pools as well as the migration, will be KYCed.
This blog breaks it all down: How Phase 2 works, who’s eligible, and what’s changing.
Phase 1 Summary — What Went Down
In Phase 1, 2,220 wallets claimed their rewards, 16,690,048 PEAQ in total. These rewards have been distributed, and Phase 1 is officially over.
As the full allocation for Phase 1 was 42,000,000 PEAQ, this means 25,309,952 PEAQ tokens moved into Phase 2, joining its first reward pool. The allocation for that pool is now at 67,309,952 PEAQ.
Any additional rewards from Phase 1 will be carried forward to the first part of Phase 2 as well.
Phase 2 Begins — Here’s All You Need to Know
As mentioned in the earlier updates, the second Phase of the early adopters rewards is focused on rewarding you for boosting the Machine DeFi ecosystem on peaq. Only the 2,220 participants of Phase 1 are eligible to take part — you can check if your wallet qualifies at this link.
Phase 2 includes two reward pools:
- Pool 1: Up to 67,309,952 PEAQ
- Pool 2: Up to 21,000,000 PEAQ
Important: The actual allocations for the pools will depend on Phase 2’s participation rate. The more tokens the qualifying wallets move into Phase 2, the higher proportion of the total allocation goes to the participants.
Rewards Distribution Pool = Participation Rate x Total Allocation
The same applies to Pool 2.
Pool 1 — PEAQ/USDT Rewards
To qualify for rewards from Pool 1, you must provide liquidity to the PEAQ/USDT pool on MachineX during the designated period: From February 10 to May 10, 2026 (updated to accommodate the users who need to unstake their tokens). Key points to note:
- The size and duration of your LP position impact your total rewards from the pool, which can range from 5% all the way to 200% of your Phase 1 rewards.
- To get the minimum rewards, you must LP at least 5% of your Season 1 PEAQ token rewards and the equivalent USDT amount into the pair for at least 10 days.
- To get the maximum reward modifier, you need to LP an 200% of your Season 1 rewards in PEAQ tokens and the equivalent amount in USDT for 90 days.
- There is no need to rebalance the position if changes due to market movements — as long as the qualifying amount was deposited initially and no withdrawals followed, every day would still count.
Here is the specific formula the rewards will be based on:
Rewards = Phase 1 rewards x Size ratio x Time ratio
Where:
- Size ratio is how much PEAQ you LPed divided by your Phase 1 rewards, capped at 200%
- Time ratio is the number of days you provided liquidity for divided by 90
Once the designated period wraps up, you will be able to claim your rewards, which will be vested over 90 days, with linear distribution. Any unclaimed rewards will go to the Treasury to fuel future liquidity initiatives.
Pool 2 — PEAQ/wstPEAQ Rewards
In the earlier update, it was communicated that the second pool of Phase 2 will be focused on testing the bridge between peaq and krest and keeping krest secure and censorship-resistant. However, that is no longer the case due to the circumstances that will be covered further later in this piece. Pool 2’s new focus is on helping to secure peaq by providing liquidity for the wstPEAQ token, the wrapped version of the liquid staking PEAQ (read more about liquid staking here). This is a fair alternative, since it enables you to earn rewards for helping to keep peaq secure and censorship-resistant and does not require you to gain exposure to any new assets: wstPEAQ is, at the end of the day, a synthetic asset based on PEAQ.
Under the updated rules, to qualify for the rewards from Pool 2, you will need to provide liquidity to the PEAQ/wstPEAQ pool on MachineX in the designated time window: from May 1 to June 30, 2026. Only Phase 1 participants can take part, so make sure to check the spreadsheet to see if you qualify. For Pool 2, your rewards are based on the size of your position, not your Phase 1 rewards.
Here is how that works:
- The total value locked (TVL) of your position is measured every day
- Your share for each day is calculated based on your TVL against the combined TVL across all participants: Daily share = Your TVL / Combined TVL
- For the final count, your share is averaged across all active days — that’s to make sure nobody tries to game the system with a last-minute position
So just to recap, the specific formula is:
(Σ Your daily share / 60) × Rewards Distribution Pool = Your reward
Where your daily share is the TVL of your position divided by the combined TVL between all participants on any specific day.
You will be able to claim the rewards after June 30th, 2026, with 60-day vesting. All unclaimed rewards will go to the Treasury for future liquidity programs.
Ending Active Support for krest
Phase 2 of the early adopters drop also marks the end of the active support for krest’s day to day operations and development from the core krest team.
krest was designed as an incentivized network meant to serve as a testing and simulation environment for Machine Economy projects before they deploy on peaq. In practice, this role did not fully align with how the network was used.
Builders chose to go directly to peaq from the testnet, since deploying twice (once on krest, once on peaq) introduced too much friction. The effort, time, and resources required simply didn’t align with how teams wanted to work.
Still, krest has played its part. It helped test and streamline the infrastructure that powers peaq today. It helped to advance peaq’s early adoption and gave it the momentum required for a smooth launch and successful growth. But with its role fulfilled and its usage declining, the core krest team has decided to wind down the network’s active support.
Once the rewards are paid out, the nodes operated by the core team will be shut down. The full node and the archive node will go offline as well. krest explorer will no longer be available on Subscan, and krest will no longer renew its core time purchases on Kusama. However, the community can still renew it if it chooses so, in which case, krest will keep running. The network will not receive any further updates from the krest team. Any other active support from the core krest team will also cease. Exchanges may delist the token, and krest’s social media handles will no longer post updates. The market maker support for the network will end, and, in the future, the website will also go offline.
To enable onchain KREST holders to migrate to peaq, the krest team has requested 1 million PEAQ from the Peaq Foundation, which has agreed to allocate these tokens in addition to the 2.5% of PEAQ’s initial supply earmarked for the krest rewards initially. The tokens will be subject to a 12-month vesting period with linear unlocks.
Migration Distribution for KREST Holders
In the weeks ahead, you will be able to migrate your KREST tokens to peaq, getting PEAQ tokens at a predetermined rate. All non-custodial wallets holding KREST tokens during the snapshot will qualify for this, excluding market makers, CEX wallets, Treasury wallets, and team wallets. The snapshot was already taken on January 12th, 2026, at block #6522856.
The migration is preliminarily slated for January 31 — February 14, 2026. To stay on top of all the latest news regarding Phase 2 and the migration rewards, make sure to follow krest on X.
