[NIP-009] - Tokenomic Adjustment: Specifications and Implementation

Voting ended over 2 years agoSucceeded

Summary

NFTEarth (ONFTE) is a promising blockchain project with multiple value propositions already in place, with a vision to revolutionize the NFT (Non-Fungible Token) space. To ensure the project's success and sustainable growth, a well-thought-out token allocation strategy has been put in place. In this proposal, we will delve into the clear rationale behind the token breakdown for NFTEarth moving forward post migration from NFTE, fully prepared for an Omnichain and interoperable future by using the LayerZero OFT standard, which makes the new token implementation not dependent on the mission critical impact of interoperability for NFTEarth - one that proved unsustainable using the common bridging methods of wrapping assets, which was the method used by the collaboration in place between NFTEarth and Multichain. The OFT standard is more secure, and at the same time more flexible, and here we would like to take a deeper dive into exploring the reasons behind each allocation to different aspects of the project.

Motivation

Prior to the token evolution to the LayerZero OFT standard, NFTEarth faced continuous obstacles in gaining DEX liquidity to grow and expand the project - The objective of NIP-OO9 is to expand define a clear tokenomic allocation for the ONFTE token that will include making protocol owned liquidity a key emphasis as the team and community continues to build.

Proposed Breakdown

What is the token allocation for NFTEarth (ONFTE) The token distribution of NFTEarth (ONFTE) is as follows:

10% is allocated to Liquidity
20% is allocated to Staking Rewards
8% is allocated to Airdrop 1
6% is allocated to Airdrop 2
6% is allocated to Airdrop 3
5% is allocated to Marketing
5% is allocated to NFTEarth DAO Treasury
5% is allocated to NFTEarth Team
20% is allocated to Advisors
15% is allocated to Reserve

Liquidity (10%)

Allocating 10% of the total token supply to liquidity is a crucial aspect of NFTEarth's tokenomics. As the markets have shown, building liquidity is difficult, sustaining it is difficult. With a dedicated allocation of the total supply used for POL - the DAO and its stakeholders will have a much higher likelihood of sustainability in both bull and bear markets. Having healthy liquidity pool ensures that users can easily buy and sell ONFTE tokens on exchanges, reducing price volatility and promoting a robust ecosystem. Moreover, it instills confidence in investors and encourages them to participate in the project, as they can efficiently manage their positions.

Staking Rewards (20%):

The allocation of 20% to the staking rewards is strategic in securing additional long-term holders and alignment of incentives for the project. It allows NFTEarth to attract early supporters who believe in the project's potential and align their interests with the long-term success of the platform. These tokens can be utilized to bootstrap development, LP locking mechanisms, other TBD incentive efforts, and other essential aspects of the project's early stages.

Airdrop 1 (8%):

By dedicating 8% of the token supply to airdrop 1 sales, NFTEarth aimed to build a foundational strong and decentralized network of people who resonated with the vision of the project - to enable access for as many people on Earth as possible to use NFTs - the airdrop was a major success and reached approximately 1,500 unique users. Initial support will never be forgotten and this incentive for engaging with the new protocol fostered trust and confidence among users.

Airdrop 2 (6%):

The allocation of 6% to airdrop 2 sales is intended to forge valuable game-theory strategies to employ (TBD by additional DAO votes) to distribute ONFTE tokens to users. By airdropping tokens to a targeted group of current and potential users, NFTEarth can bring in many new users in a rapid pace - opening doors to new opportunities and expanding the platform's reach.

Airdrop 3 (6%):

The 6% allocation to airdrop 3 builds on the same concepts as the 2nd. It is to be carefully constructed using a data driven approach and distributed in accordance with a DAO consensus on the best way to distribute the tokens. Conducting token distribution in this manner ensures continuous community involvement and engagement, something that NFTEarth has excelled at in its short existence thus far.

Marketing (5%):

Devoting 5% of the token supply to marketing efforts is crucial for NFTEarth's visibility and adoption. Strategic marketing initiatives can drive user acquisition, boost awareness, and position NFTEarth as a prominent player in the competitive NFT market.

NFTEarth DAO Treasury (5%):

The allocation of 5% to the NFTEarth DAO Treasury empowers the community to govern and make decisions for the project collectively. A well-funded DAO can support development proposals, incentivize contributors, and execute strategic initiatives that align with the community's vision.

NFTEarth Team (5%):

Allocating 5% to the NFTEarth team rewards their hard work and dedication to the project. It ensures that the team members are vested in the project's long-term success and fosters a committed workforce striving for excellence.

Advisors (20%):

The allocation of 20% to advisors is a testament to the value they bring to NFTEarth's growth and development. Advisors with industry expertise and networks can provide valuable guidance and open doors to partnerships, growth opportunities, and overall project success.

Reserve (15%):

Setting aside 15% for reserves acts as a safety net for the project. These reserved tokens can be utilized for future development, addressing unforeseen challenges, or adapting to changing market conditions.

Conclusion:

The token allocation breakdown for NFTEarth (ONFTE) is carefully designed to support the project's growth, decentralization, and long-term success. Each allocation serves a specific purpose, whether it's to bootstrap development, incentivize stakeholders, or foster community governance. By formally implementing this meticulous tokenomics strategy, NFTEarth positions itself for a sustainable future within the dynamic and ever-changing NFT ecosystem.

Implementation and other considerations

Moving forward, the ONFTE token will be used as the unit of governance power and value accrual for the NFTEarth DAO. It is also TBD by the DAO if only veONFTE is used or a combination of multiple forms.