$1DFX Tokenomics
Last updated
Last updated
The 1DFX token will be distributed in two phases:
Users can provide liquidity in the $weETH / $wstETH pool & stake their LP tokens to earn real $1DFX tokens, as well as partner rewards from Zircuit & Ether.fi
Phase I is aimed at decentralizing the $1DFX distribution to the community, therefore there won't be any trading activity during this phase.
$1DFX Token becomes tradeable and is exchange-launched
$1DFX Holders can stake to earn more
Trading on 1DFX commences
$1DFX emissions will decrease as trading fees are introduced
Liquidity is the backbone of an exchange. In order to bolster liquidity, 1DFX employs a volume-based emission formula to reward liquidity providers (LPs) proportionally to their contribution to the liquidity pool. This mechanism incentivizes LPs to maintain and increase their liquidity positions, while contributing to the depth and efficiency of 1DFX by providing ample trading opportunities for users. By directly correlating rewards with the value of liquidity supplied, the protocol fosters a robust and active trading environment.
The $1DFX token emission schedule is designed to incentivize liquidity provision and token holding within the ecosystem while ensuring long-term token sustainability. The mechanism employed is similar to the Bitcoin halving model, where token rewards are progressively reduced over time.
Liquidity Providers (LPs): LPs will earn real yield from trading fees as soon as trading commences
Liquidity Providers Stakers : LPs stake their LP tokens to receive a portion of the $1DFX token rewards, including trading fees as soon as trading begins.
$1DFX Stakers: Users can directly stake their $1DFX tokens to earn additional rewards. This incentivizes token holding and supports the ecosystem's growth.
The $1DFX token emission rate will undergo periodic reductions, similar to the Bitcoin halving model.
Scarcity and Value Proposition
Limited Supply: By reducing the token emission rate over time, halving creates scarcity.
Investor Confidence: A controlled supply mechanism can boost investor confidence, as it demonstrates a commitment to long-term value preservation.
Economic Sustainability:
Inflation Control: Halving helps to mitigate inflationary pressures that can erode the purchasing power of the token.
Reward Structure: By gradually reducing rewards, the protocol ensures the sustainability of the incentive structure over time.
Market Dynamics:
Anticipation and Volatility: The predictable halving events can create anticipation and volatility in the market, potentially attracting investors.
Long-Term Perspective: Encourages a long-term outlook among token holders, as they anticipate future value appreciation.
The $1DFX token emission schedule is a core component of the project's economic model. By aligning token rewards with key contributors to the ecosystem, the protocol aims to foster a robust and sustainable decentralized platform.
