When we were designing the Genesis Worlds tokenomics, we looked at a lot of different ways to balance the supply of tokens against demand from the market. Most projects set a fixed amount of tokens (100M), and then award themselves 30% of those tokens right out of the gate, and another 20% to investors and advisors. That’s ludicrous on many levels. Firstly, do they really think that their contributions are worth 50% of the total value of a project? If we really take into account how much value the community itself creates, the real number is closer to 5% than 50%. Secondly, this is straight out of the Soviet centrally-planned economy playbook. We’ve got all these amazing free market tools. And we’re arrogant enough to think that we can design a token distribution better than the free market? No, that’s not our way.
But, we’re not your run-of-the-mill crypto-libertarians either (can we upset the far left and the far right in one blog post? We’ll try). Our philosophy couldn’t be further from libertarianism. Instead, we’re focused on group and collective effort, and ways to incentivize that. So you’ll see a lot of initiatives from us that reward community groups for getting involved in Genesis Worlds.
But, back to the token distribution. 100M (roughly 10%) of GENESIS tokens will be distributed to early adopters, through the launch pool, and liquidity mining. The other 90% (roughly) are mined via the World Stakes. We say “roughly” here because we don’t know, and cannot know ahead of time – the exact distribution depends on how many World Stakes the community decides to buy.
The reason we don’t know is because we’re using bonding curves to set World Stake pricing, rather than just assuming we know best and pulling some random fixed price out of our… you get the idea. In a bonding curve, the price of a token depends on the number of tokens that exist. So the 1000th token costs 4x the price of the first token. And, you can sell back the World Stake to the smart contract at any time, for the current price, ensuring a 100% liquid market for every World Stake. This is a fully decentralized approximation of a true supply and demand curve, where the more demand, the higher the price.
So, if demand for World Shares is high, more GENESIS will be emitted. But the increasing price per World Share creates a soft limit, where it’s not economically beneficial to buy a World Share. So even though there’s no hard limits anywhere in the system, there’s still a firm cap on the amount of GENESIS that can be created. We expect around 1Bn to be created via World Shares (over 20+ years – remember, we’re in this for the very, very long term), but that number could in theory be 500M or 2Bn.
Of that expected 1Bn, 40% is directly mined by World Stake owners, 20% is mined to GENESIS owners who participate in Genesis governance (we encourage you to double-dip here, to gain both the World Stake 40% and the governance 20%), and the remaining 40% is mined to the Genesis Foundation, and used to reward content creators, developers, and community members who help build and grow Genesis Worlds.
So in addition to earning GENESIS from your World Stake, you’re also directly supporting the Genesis Worlds development community, and the decentralized governance of Genesis Worlds. From our perspective, this is a great balance of DeFi technology with the needs of a truly decentralized community. For those who’ve read this far, the GENESIS ERC20 token will launch on October 28th, 2021. You can view more about the Genesis project at the Genesis Hub.
Interested in learning more? Want to speak with the team directly? Join us in our GAME Credits Labs Clubhouse club now to see our speaking schedule: GAME Credits Labs Clubhouse