Scaling Trajectory

Why?

Traditional Domain Name System (DNS) services primarily focus on domain registration and record management, neglecting the potential for further utility and value creation. We propose a novel solution by leveraging non-fungible tokens (NFTs) to transform domain names into dynamic digital assets. By wrapping a domain in an NFT, we unlock new functionalities such as on-chain tracking of ownership history and activity, integration with DeFi protocols for yield generation, and decentralized governance mechanisms. This empowers domain owners to capture the full value of their assets and unlock new revenue streams.

How?

One of the major challenges in DeFi and crypto projects, especially those with static token supply, is scaling gracefully alongside success. Manual adjustments to emission rates, yield curves, and reward parameters often result in sluggish and inefficient responses to market dynamics. Conversely, pre-minting the entire token supply can introduce vulnerabilities to market manipulation and exploitation.

Our deep dive into past and present projects led us through various token models, including dual token economies akin to Axie Infinity, innovative liquidity mechanisms like OlympusDAO's protocol-owned liquidity, NFT-centric ecosystems like DeGods or BAYC, and other novel approaches. We observed how diverse projects utilize different methods to respond to market fluctuations. By evaluating these established models, we learn and incorporate their strengths into our own tokenomic design, with the aim of fostering a more robust and adaptable solution for our project's ecosystem.

Dual Token Models

• In games like Axie Infinity, dual token models employ two distinct tokens to create a self-sustaining ecosystem.

• AXS (Governance token) with a fixed supply grants voting rights and access to the ecosystem's treasury.

• SLP (Utility token) unlimited supply is used for day-to-day operation of the game.

• Players can earn SLP via in-game activities and can stake it for AXS, fostering engagement and driving up the value of both tokens.

• Advantages: Creates a sustainable in-game economy that aligns player's benefits with protocol's interests.

• Disadvantages: Complex to manage and balance with a heavy reliance on player activity and market demand. SLP minting ramps up with the adoption of the game, causing a massive price dump as supply overwhelms demand.

Protocol Owned Liquidity (POL)

• Popularized by OlympusDAO, POL involves the protocol acquiring and locking its own tokens in a liquidity pool. This creates a readily available pool of tokens for trading, reducing price volatility while also limiting the circulating supply, potentially pushing the price up through demand and scarcity.

• Advantages: Enhances token price stability and tradability. Subsequently generates protocol fees from trading activity. The protocol control most of the liquidity which increase the overall resilience against market movements.

• Disadvantages: Requires significant upfront capital investment and can be risky if the token price falls significantly. The protocol team control the majority of liquidity.

Algorithmic Market Operations (AMOs)

• Protocols like Frax Share utilize a secondary token (FXS) to indirectly influence the price of the main stablecoin (FRAX).

• AMOs automatically buy/sell FXS in the open market to guide FRAX's price toward the peg.

• Advantages: Can be very stable and less prone to volatility.

• Disadvantages: Requires more complex smart contracts and may be susceptible to manipulation.

Deflationary NFT Collection

• DeGods started with 10,000 unique NFTs which are designed to decrease in total number through a burning mechanism where holders can choose to burn their DeGod NFT in exchange for $DUST, the project's utility token.

• DeGods holders can stake their NFTs to earn $DUST daily. This incentivizes holding onto DeGods and creates a source of passive income for holders.

• Ownership of a DeGod grants access to the exclusive DeDAO that governs the project's future and provides holders with a voice in how the DeGods ecosystem develops.

• Advantages: The burning mechanism creates scarcity for DeGods NFTs while staking incentivizes holding and provides a passive income stream, driving their value up over time. Holders can also participate in the project's decision-making process.

• Disadvantages: The overall success of the DeGods model relies heavily on the value of $DUST. If the token loses value, it could disincentivize NFT staking or burning and negatively impact the entire ecosystem. Burning a DeGod NFT is a one-way process.

Choose your fighter!

To achieve a sustainable tokenomic model, our project has opted for a hybrid approach, combining elements from the established DeGods NFT model and the OlympusDAO protocol. This strategic selection leverages the success of both models in fostering a loyal community and driving token value.

We have incorporated specific adjustments to ensure token prices closely adhere to free-market demands, thereby incentivizing long-term holding. Additionally, events and activities will stimulate token utility within the project's ecosystem, creating a positive feedback loop between token usage and overall project growth, establishing a robust foundation that will propel the project's evolution over the long term.

The First of Many

The initial project phase will focus on implementing NFT yield farming mechanisms, similar to those employed by successful projects like DeGods and BAYC/MAYC. However, our approach will incorporate some unique twists to differentiate ourselves within the competitive DeFi landscape.

Additional services will be deployed through strategic collaborations with other fellow projects in the Blast ecosystem. This will encourage users to not only expand their investment portfolios but also cultivate broader influence across a diverse range of protocols and grow their digital footprint that ties with their DomainName NFT.