Sovryn Tokenomics - Taskforce

Recently, there has been a great deal of discussion on the Tokenomics of SOV.

Questions have been raised around the emission schedule in threads Such as these:

Around the structure of staking:

And around LP rewards:

These are complicated issues that need to be examined on an on-going basis. For this purpose I think we should create a DAO/taskforce, that can act independently of the exchequer. I think this can be formed as a DAO and also receive a grant to help support its efforts.

Who should consider joining such a task force?
Anyone with interest and domain expertise is economics, governance, DAO formation and participation, risk analysis or quantitative modelling can be a good candidate.

If this is you - or you have other ideas - this is the thread for you.


Hi Yago, great that you still want to talk about.

However, the proposed SIP from yesterday had really valid points and a lot of people in your community say they are in support of it.

From the AMA you did, I thought you suggested to lock tokens for 10 years? :closed_lock_with_key:

Then there is the suggestion to change the time lock on staking, as you also posted here.

And… the need for change of User Interface/Experience, which seems to be agreed upon by all.

So why do you want this task force? A majority of (y)our community already told you they would like to see these changes being implemented. A minority with the majority of the tokens and VP maybe don’t. You see where I’m going?

It feels only Sovryn to talk about it, sure… but changes (that where suggested) are really needed to make us more Sovryn. That can only be achieved if you’re really prepared to meet your community half way, because we all know you hold the VP amount against the community in numbers. Based on the AMA I felt you was going to meet your community, but now I feel that I am not convinced yet. On this point I am not the only one and that’s important. Community remembers, like a bunch of elephants :elephant::smile:

So let’s keep talking Yago, but let’s not change the narrative on the three points that so many of us ask for. And please don’t be mistaken: we all Sovryns and Sovryns are in for the long run. Only long run doesn’t mean not having short term expectations and vision to steer us away from all the trouble our beloved project finds itself in. And let’s agree that Sovryn is in trouble.

Thank you.


I think this thread is for the individuals that are willing to join the taskforce and do the work. There is a clear willingness to adapt token economics to the current environment but these adaptations require experienced competent individuals.


I’d be happy to join such a taskforce/DAO. It will be a difficult task.

What should be the first goals?

-A detailed list of current tokenomics which serves as a basis for the upcoming discussions.

-An analysis of how many tokens become liquid over what period of time: Liquidity mining rewards, staking rewards, spendings from exchequer and core team and tokens from investors/team members that are becoming liquid over time. We need to show the proportion of all subgroups.

-Comparison of token issuance with current platform volume and community-growth. Can the token emission be covered by the platform revenue/user growth or is the printing press running too hot?

-Many of these tokens already have an owner. Where would it even be possible to change the token emission without depriving individual members of their shares?

-A study on the advantages and disadvantages of reducing various funds.
-What to do with liquidity providers that suffer high impermanent `loss and would be
hit hard by reducing LM rewards?
-Is a larger token lockup over even longer and more profitable staking periods conceivable?
-Is the development and growth of development secured?

-Assessment and mediation of different stakeholders through surveys and direct discussion.

-Offering incentives to get disadvantaged groups on board or looking for volunteers who will take cuts for sovryn’s long-term success.

-As a first major goal: Create a SIP to vote on for bitocracy that leads to a reduction of tokens in circulation/emission. Either through a variation of the issuance period, or buy-backs and long lock-ups or even burning.

-Subsequent review and evaluation of the measures carried out with a further influence also based on the growth of sovryn and token price.

  • It might be useful (at least for me :slight_smile: ) to understand the strategy of the initial tokenomic = such choice was made to reach such objective. It ll be easier to come up with adjustment when necessary.
  • other point (correlated) : I understand that a big part of the difficulty (and the polemic) is coming from a difficult cohabitation between short term and longer term objectives => I think it is necessary to separate right the beginning which term we are serving (as well as the priority)

TL;DR Tokenomics are not only key for (short/medium-term) price action. Sound tokenomics are also at the heart of Bitocracy’s protection against governance attacks. I would be happy to contribute to such a taskforce. In line with @Sacro, I propose the task force (i) reviews current tokenomics and makes all elements transparent to the community, (ii) investigates ways to stabilize circulating supply, such that supply can increase in line with demand (iii) investigates a fortification of bitocracy’s security against SOV price drops.

Time locked staking, governance attacks and tokenomics

As a long-time lurker on discord/dojo/forum/community calls, I decided to make a forum account yesterday and engage in this discussion, because this topic is important.

As argued by @yago in different posts, time-locked staking is supposed to act as the central protection of the protocol against governance attacks. The current staking reward system is designed to be forward facing and aims to incentivise long term future thinking: People most dedicated to the project – as demonstrated by their action to lock-up capital for a long time - should have a bigger voice.

These design principles are in my view sound and - as yago pointed out - they allow to draw a PoW analogy through the (opportunity) cost of staking. But this design relies on a key underlying assumption: for the incentive structure to work as intended over time, SOV price should be stable/increasing over time.

This can be illustrated with a simple example:

  • Sovrynaut A invests 100USD in May 2021 at a price of 85USD, getting roughly 1.2 SOV. Taking a long-term view, sovrynaut A stakes for 78 periods, and gets 12 voting power.
  • Sovrynaut B invests 100USD in April 2022 at a price of 3.6USD, getting roughly 27.8 SOV. Taking a short-term view, sovrynaut B stakes for just 1 period, and gets 33.36 voting power.

Both sovrynauts have the same USD opportunity cost (I’m simplifying here, by just focusing on the direct cost to purchase SOV, ignoring e.g., yield that could be earned). But sovrynaut B gets roughly three time the voting power of sovrynaut A, despite sovrynaut B making the shortest and sovrynaut A making the longest possible commitment.

While this example is extreme, it demonstrates that tokenomics and their price implications are also at the heart of Bitocracy’s security. Considering the price action over the past months, reassessing Sovryn’s tokenomics is thus also imperative for the protocol’s security.

Given above, I would be happy to contribute to such a taskforce (and my profile fits well in @yago’s description - being an economist with a quant & risk background).

Potential steps for a taskforce

I agree with @Sacro that the first step must be a detailed assessment of where we are. It is currently not straightforward to understand key features from an outside perspective. For example: my understanding is that we are in month 15 of SOV’s emission schedule as displayed in the blackpaper, which should coincide with roughly 35mio SOV fully vested. How does @yago’s remark made in the SIP0044 thread, that the emission schedule has already been slowed-down, play into this? How does this reconcile with circulating supply currently shown as roughly 21mio? All elements of todays’ tokenomics should be crystal clear to everybody to start an efficient and constructive discussion.

In a second step, options that could stabilize circulating supply can be explored. What are advantages/disadvantages/technical constraints? Some ideas have been proposed in different threads, including draft SIP-0044, and merit a detailed assessment. Other options should also be looked at.

In a third step, one could try to further fortify bitocracy against SOV price drops, which work against the desired incentive structure. A modification of the staking mechanism could be one solution. A modification of how voting power is computed could be another (e.g., instead of computing voting power as a sole function of SOV, one could explore computing voting power as a function of the SATS value of the staked SOV).

Given the input from BCW with draft SIP-0044, which led to one of the most intense discussions in the community that I witnessed so far on forum, tg & discord, I would find it beneficial if BCW members would participate in the tokenomics discussions (disclaimer: I’m not part of BCW).


Hey, after digging into tokenomics today, i want to share a first comment. Please note that I will provide full spreadsheets later on, this is just a first draft and meant to provide some graphics to our discussions and thoughts. I did not have much time since this morning.

The thoughts are based on official tokenomics data that can be found here SOV Token Emission Schedule - February 2021 - Google Sheets

I believe we are in month 15 now. According to the official data, I identified the funds that have the highest token emission:

Founders Fund: 833.333 tokens per month until month 36 (02/2024)

Ecosystem Fund: 233.585 tokens per month until month 24 (02/2023)

Adoption Fund: 1.129.400 tokens per month, going down each month until 20.000 SOV in month 69.

These 3 Funds are the ones that I changed in the chart below to see what could be possible.

In addition, there is:

Early Funders: 731.121 tokens per month until month 24 (02/2023)

Development Fund : 250.000 tokens per month, tickling down each month until 2900 SOV in month 83

I did not change these 2 funds at all, they are here for the sake of completeness. I did not touch these in my calcs because these tokens are vesting and belong to investors already or they support ongoing development. There could clearly be a discussion whether it’s fair or even possible to alter the founders fund as these tokens also belong to individuals. I am not sharing my point of view here, I try to analyze this in a rational way and provide data for discussion…

When looking at the charts, you can see that the token inflation is really high right now and that 3 million tokens become liquid each month. I adjusted the vesting periods of the founders fund, ecosystem fund and adoption fund from month 15 onwards. Their emission schedule gets much longer, with a reduced amount of tokens unlocked each month. These numbers can be changed to whatever, but this first test achieves the following keynotes:

Reduction of new SOV supply in month 16: 1.8 million instead of 3 million. This reduces token inflation by 50%: Instead of 6% overall monthly inflation, only 4% overall monthly inflation.

Reduction of new SOV supply in month 25: 1 million new SOV instead of 2 million SOV. Overall inflation reduced to 1.9% instead of 2.8% in that month. There is no buy back, lock up or burn yet. This can be added based on feedback. This just stretches the emission schedule as can be seen on the x-axis of the charts.

This is just a first step to show where this could lead if there’s a consensus. Additional steps like lock-up, buy-backs and so on can be added.

I would like to add that as Sovryn is a project with a longer time-frame than 3 years (where 90% of supply is liquid), it could make sense to change the tokenomics in a way that also supports longer timeframes. The difficulty is that a lot of funds already belong to someone and the emission is impossible or extremely difficult to change. The easiest would be to do it via ecosystem fund and adoption fund.

Hi @bananas_in_the_sky , great perspectives! Looking forward to our joint effort and discussions!


@Sacro I’d like to assist. Will review all comments and see where we can collaborate. I’d like to enlist @Martin_Adriaan as well. Any BCW members that have experience in areas Yago mentioned or have familiarity with outside project tokenomics would be great to have on too. For anyone not familiar with Sovryn protocol, I’m happy to elaborate on any areas of Sovryn which you may not be as familiar with.

@yago can you recap for us which parts of tokenomics can be modified without needing to re-issue and effectively fork? This will allow us to know what variables we can play with.



I believe that the community does not understand tokenomics. That’s why I have asked twice to make an AMA about it, before all this happened.

Maybe you could ask the community what they don’t understand, what their doubts are, and help them understand. Educate them.

At the same time I would find out how many people want to change the tokenomics and in what way, because it could be that they are asking for different things, or repeating what one person is claiming, without even understanding it.



i found your write-up with regard to tokenomics and bitocracy security very fascinating, i did not think about it like this before. If we propose a SIP some time in the future, this should definitely be included in the arguments.

I’m currently digging not only into theoretical tokenomics but also the practical side: which part of the unlocked SOV gets sold each month, and who is not selling. It may be that the founders fund, while huge, is not the reason for current selling pressure. This needs to be identified so that our solutions will have a meaningful impact and so we push the right buttons.

I will try to create a data set or at least get information with regard to the different funds, their schedulded emission and their real emission/holdings. I will try to talk to exchequer/Core team and ask what they think which parts of tokenomics can be changed at all due to vesting/being property of users already. This would basically be your step 1 from your post and part of step 2.

If you’re fine with that, it would be great if you could do some research towards your point III) fortify bitocracy and, if appropriate, also do some digging with regard to part 2. I think this could lead to a valuable base for a discussion with the community once we have that info.



Sounds good. I will look into step 2 and 3. I will also ping you on discord to potentially catch up over a quick call regarding step 1.


Adoption fund contract

Hey @Sacro, as mentioned yesterday, I looked at what I believe is the adoption fund contract (0x0f31CFd6Aab4d378668ad74deFA89d3F4DB26633).

I summarized what I found in this spreadsheet: Sovryn - Vesting schedule implied by contracts. The sheet also has these two plots that give an overview on the vesting schedule implied by the contract:

Assuming my understanding of the functions and state variables in the contract is correct, I see the following key points:

  • Out of 37,222,240.20 SOV that were originally in the contract, 17,494,453.11 SOV will be fully vested by May 8th, 2022 and could theoretically be retrieved fully by the unlockedTokenOwner.
  • Out of those 17,494,453.11 fully vested SOV, 7,568,522.11 SOV are still in the contract, the rest has been moved out in October 2021.
  • The (monthly) vesting schedule implied by the contract does not really reconcile with the adoption fund vesting schedule listed in the official SOV Token Emission Schedule - February 2021. Possible that I miss a point, would be good if somebody who has a deeper understanding could provide context (@dseroy maybe?)

Development fund contract [Section added on 08/04/2022]

@Sacro, I did the same assessment for what I believe is the development fund contract (0x617866cC4a089C3653DDc31A618b078291839AEB). I updated the spreadsheet: Sovryn - Vesting schedule implied by contracts. The following plots give an overview of the schedule:

Key points:

  • Out of 8,368,597.68 SOV that were originally in the contract, 3,765,869.01 SOV will be fully vested by May 8th, 2022 and could theoretically be retrieved fully by the unlockedTokenOwner.
  • Out of those 3,765,869.01 fully vested SOV, 1,534,242.93 SOV are still in the contract, the rest has been moved out in October 2021.
  • Same as for the adoption fund, the (monthly) vesting schedule implied by the contract and the total amount that was originaly held by the contract do not really reconcile with the development fund vesting schedule listed in the official SOV Token Emission Schedule - February 2021. This is a point to follow up.

Post change log

  • edit 1 (07/04/2022): fixing some typos in figure 1
  • edit 2 (08/04/2022): (i) added development fund section to the post to keep the analysis in one place, (ii) added headers for post readability and changed name of google sheet
  • edit 3 (09/04/2022) fixed a mistake with dates (original post was off by 1 month, the reported amounts were for may 8th, not april 8th)

Hey @bananas_in_the_sky , really great info there!

with regard to the movement in October, i believe it was related to this SIP

It exactly states 9.925.931 SOV from the adoption fund, right on spot.
Can @dseroy or another exchequer member give an update how much of this is still held by the exchequer and what part has been sold/distributed?

  • Are these 9.925.931 SOV actually those tokens that currently pay the liquidity mining / liquid SOV rewards?

According to SOV Token Emission Schedule - February 2021 - Google Sheets the adoption fund is the only remaining fund, which tokens enter a 10 month vesting after being issued/claimed.

  • If we have ~17.500.000 fully vested tokens by end of the month and of that, 9.925.931 held by the exchequer and 7.568.522 tokens that are still in the contract, we must assume that these tokens have not been used for liquidity mining.

  • So an additional assumption could be made that all those tokens are yet to be distributed to anyone and that they do not have individual / 3rd party owners yet. That’s a very interesting find.

By the way, the emission schedule states 38.646.017 adoption fund SOV, so there’s a difference of 1.400.000 SOV between your real data and the spreadsheet data.

The liquidity mining and Staker rewards make up ~450.000 SOV / month with a pretty constant rate over the last months (Liquid SOV for stakers beeing the only variable that changes constantly) so it makes sense that there are a lot of yet to be used adoption fund SOV, held by the exchequer / bitocracy.

If our posts are correct, i understand the comment from @yago that the distribution of tokens has already slowed down. And it would provide an argument that it makes sense to get a SIP with regards to tokenomics done as we seem to have so much more supply than demand and a lock-up can make sense.

edit: typos, form


Let me tell you why, even after proposing it as willing to accept the 10 year lockup of the team tokens and others that dillute the tokenomics, Yago is not willing to accept it:

His modus-operandi is if he disagrees he doesn’t directly tell you like myself “go fuck yourself, I’m not going to do it”. In a honest, but confrontational way.


Yago treats you for an idiot and uses his manipulation technique by simply saying “we will discuss it” we need to do a task force. We need to think about it.

EVEN AFTER you showed him with huge majority what you want.

As long as he doesn’t want it or he can’t call some big wallets to vote in his favor that are not known as team wallets (think of Pomp and such)… he will be doing “daos”, “task forces”, “discussions”…

until a point when in such discussions will remain only people who are so bored they have nothing else to do than to be a forum granny… and finally accept whatever he proposes.

You can vote now 100:1 in favor of a sip, he will still create these measures designed to manipulate you.

What’s the point of the SIP structure if sip is not good enough to make decision but he needs a task force or a dao to judge on this one in particular (the one that doesn’t come from him and touches his sensitive part).???


@Sacro @bananas_in_the_sky thanks for driving this forward! I’m in Miami with a few team members so haven’t been able to dive into this yet. I’ll have to try and review as soon as I get back.

Let’s keep noting down any questions then we’ll consolidate and get answers from Armando/Exchequer.

Great work!


Sorry to be a wet blanket. Writing a description for this thing for general audiences is bloody hard.

Awesome work so far! Graph is mostly implemented, so we can give you guys early access.

I’d like to set up the first tokenomics meet next week. Does 4PM UTC work for everyone, as a general time?


Sure, i’m very excited!

Honestly 4:30 PM or 5 PM would fit me much better in general but i could certainly arrange that as well.


yes, 4pm utc generally works quite well


good for me as well. thanks