Tokenomics

Tokenomics is a field combining blockchain technology and economics to force trust, incentivize behaviors, and establish value within decentralized digital ecosystems.

Tokenomics makes up an important part of any crypto project. Questions of how tokens are issued (i.e., the Token Issuance Model), how they are distributed (i.e., the Token Distribution Mechanism) and how tokens are used to manage the project (i.e., Token Governance), often determine the success or failure of a project. Tokenomics also play an especially important role in funding and managing a token-economic project. There exist several approaches such as ICOs, token-curated registries, and DAOs. These offer various mechanisms for raising funds, distributing tokens and managing decentralized digital ecosystems. However, all these approaches come with drawbacks such as potential misuse, lack of transparency, regulatory non-compliance, and challenges in pricing and liquidity. This makes careful considerations and management of their respective complexities and challenges necessary. In this context, striking a balance between incentivizing participation and maintaining economic stability is a critical trade-off, and the quest for the ideal model remains an ongoing challenge.

In the context of token distribution and pricing, the concept of Augmented Bonding Curves (ABC) plays a central role in the REMAP token-economic system. ABCs establish a connection between token price and supply. ABCs can enable more sustainable token economies, as they allow for a dynamic adjustment of token supply based on demand, mitigating some of the effects of sudden token supply or demand shocks while assuring liquidity and stability throughout the token’s lifecycle. In order to do this, they incorporate a collateral pool to sustain token value and a second distinct funding pool for ongoing development and maintenance.

Specifically, in the REMAP ecosystem, this approach mitigates token price volatility and minimizes the risk of token value collapse. This ensures a deterministic token price upon issuance and a potentially fairer, more equitable pricing mechanism, while offering enhanced investor protection compared to traditional ICOs. While ABCs are a rather new and innovative concept, they have been implemented quite successfully. As they represent a promising area of token engineering, current research focuses on potential applications in various decentralized finance (DeFi) scenarios, including public goods funding, liquidity bootstrapping for new tokens, and decentralized governance.

REMAP introduces a token-economic design that merges the Augmented Bonding Curve (ABC) model with a unique block validation pricing mechanism. Unlike conventional models where coin value is tied to the quantity minted, the valuation of the REMAP coin (RMC) correlates with the blocks validated. Furthermore, a unified one-coin approach, avoiding the complexity of managing multiple tokens for various use cases, making the system more accessible. Embedded within REMAP’s layered module architecture, this approach offers benefits for all stakeholders: investors can anticipate clearer economic feedback loops, developers are rewarded in a straightforward manner, and end-users experience a more intuitive, transparent platform.