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!