We are excited to release the proposed tokenomics for Coinecta. This article will explain the thought process behind the numbers chosen for each section of the tokenomics, and explain the proposed token utility for the CNCT token.
Coinecta is a launchpad built for the Cardano blockchain. Our philosophy is anchored in supporting innovative and revolutionary projects looking to launch their tokens in a manner that’s fair and transparent, without the help of VCs. We’re driven by our commitment to fostering a robust and thriving Cardano ecosystem.
Coinecta will work with other launchpads for cross-chain launches, but is built on Cardano and will always be focused on the Cardano ecosystem first and foremost.
If you’d like to learn more about Coinecta, please read our whitepaper, which explains how a launchpad works in detail.
The main utility of the CNCT token is to reserve spots in IDOs launched through the platform. By staking CNCT tokens and reaching one of the stake tiers, you will have allocation reserved which allows you to purchase seed round and pre-sale tokens for upcoming project launches on the Cardano blockchain.
The token will also be used to support governance decisions through on-chain voting. This will be facilitated using Paideia’s DAO management software when the Cardano port is completed.
The total distribution of Coinecta tokens will be eighty million (80,000,000 if you’re American and 80.000.000 to Europeans. We’ll use the American style from now on). 38M will be reserved for staking emissions distributed over 5 years.
The breakdown is as follows:
- Ergopad Staker Round: 3,000,000, 3.75%
- Pre-sale: 16,000,000, 20.00%
- Dex Locked Liquidity: 1,200,000, 1.50%
- FISO Distribution: 1,600,000, 2.00%
- Treasury: 5,200,000, 6.50%
- Marketing and Promotions: 5,000,000, 6.25%
- Staking Emissions: 38,000,000, 47.50%
- Team & Advisors: 10,000,000, 12.50%
The pre-sale will be a public token sale of CNCT tokens available to anyone who is approved in the KYC process. The vesting schedule for each section will be outlined in a chart and shared on the Coinecta Whitepaper. A brief summary:
- Ergopad Stakers vest linearly over 10 months
- Pre-sale tokens unlock linearly over 8 months
- Team & Advisors have a 6 month cliff with a 24 month vesting period
- FISO distribution has a 3 month cliff
DEX Locked Liquidity
We will lock liquidity on a chosen DEX. The DEX will be chosen based on market penetration and number of active users. What this means is that we will add ADA/CNCT liquidity to the DEX with the most volume, and lock the LP tokens, so that the liquidity can not be removed. This ensures there will be enough liquidity available to keep price slippage low on CNCT token trading.
Staking emissions are set to last 5 years, and will be distributed in a linear way, meaning the daily emission stays the same throughout the entire 5 years. As more tokens are distributed and more stake is added, the APY will slowly decline over that time. The Marketing and Promotions section will also be used to add bonuses from time-to-time, especially in the beginning to encourage liquidity providers.
Staking CNCT tokens is similar to staking ADA. You can also stake CNCT-ADA LP tokens from supported DEXs, so it will be similar to a yield farm. Staking LP tokens will include an additional bonus, due to the added risk of impermanent loss.
Ergopad Staker Round
The tokenomics include a round reserved for Ergopad stakers. The Coinecta team is also the team behind Ergopad, a launchpad on the Ergo blockchain. This is where we started, and we believe that being loyal to our initial supporters is extremely important.
We also understand that there will be new supporters joining us from the Cardano ecosystem and we wanted to ensure we balance our appreciation of both groups. If we offer too much to the Ergopad supporters, it will not be fair to anyone who joins us now.
After a lot of thought and community feedback, the decision was made to offer a small number of tokens specifically to Ergopad stakers, who will still need to purchase tokens with $ADA, but will reserve their allocation using their Ergopad token stake tiers.
Anyone who stakes Ergopad in a tier before the Coinecta presale will be eligible for this round. We reserved fewer than 1/5th the number of tokens for Ergopad stakers as was reserved for the CNCT public pre-sale to try to keep things fair. We are open to feedback from the community with regards to this decision.
Signups for the Fair Initial Stakepool Offering (FISO) will be announced shortly. We will select a certain number of stake pools at random from those that sign up. There will be a maximum stake per pool to encourage decentralization into smaller pools. Once the pools are announced, you’ll be able to use the FISO dashboard to add your stake to any of the chosen pools, and during that time, some of the ADA earned by staking will be converted into CNCT tokens. These will be distributed shortly after the TGE via airdrop to all stakers.
Treasury and Marketing
The treasury and marketing sections will be tokens reserved for future use. Marketing and promotions are things like prize giveaways, sponsoring events and other endeavors, and potentially for providing liquidity to other platforms or cross-chain bridges in the future. The treasury will be typically used for things like paying community manager salaries and other expenses which make sense to pay in tokens.
Once Paideia has Cardano support on their DAO management software, the community will be able to vote on treasury expenditures based on the number of CNCT tokens held.
Thank you for reading the tokenomics. We value community feedback and would like your input on the numbers. Now is the time to suggest changes, since the tokenomics are not set in stone until TGE, so please join us on Discord and Telegram and share your thoughts.