Updated: Aug 10
Yanda is one of the first HyFi (Hybrid Finance) protocols that merges CeFi (Centralized Finance) and DeFi (Decentralized Finance) solutions with a CEX (Centralized Exchange) infrastructure, enhancing the transparency of off-chain transactions.
But how is a token designed? What are the fundamental aspects that you must consider when creating a token?
The term tokenomics stands for token economics and indicates the subject that studies the design of economic systems based on blockchain technology.
The object of the study of tokenomics concerns the economic functioning of tokens, including all the procedures of creation, distribution, and related incentive mechanisms for those who will use them.
In detail, the aspects that are included within an excellent tokenomics project are:
Nature of the token - What is the primary function of the token? (Security, Utility).
The choice of token type depends on the primary networks' purpose, for example, you decide to use a governance token to distribute decision-making power to its owners and make the protocol decentralized.
Usability - What are the use cases and the rewards mechanisms for participants?
The design of the incentive system and use cases is perhaps the most sensitive stage of tokenomics. This phase requires mapping the stakeholders who will use the network and the design of the mechanisms/benefits that favour the adoption of the token. (For example, some benefits could be cash back for debit cards, participation in launch pool and launchpad, or discounts on trading fees).
Monetary policy - How is the issuance and distribution of the token handled?
The initial allocation and the distribution to stakeholders are fundamental aspects.
(For example, a token with an unlimited supply and a very high daily issue is a resource not scarce, inflation, and consequently is likely to be uninteresting for a potential future appreciation).
Governance - Who has decision-making power in the network?
This choice depends on the degree of decentralization of the protocol and on the eligibility criteria for expressing voting power.
(For example, at the highest degree of decentralization, anyone who wants to participate in protocol decisions can vote in a way that weighs proportion to the number of tokens held. Alternatively, for a more centralised approach, during the design stage, you can choose the individual nodes that will have the right to decide and change the protocol).
The most known metrics of tokenomics include:
Max Supply = the maximum number of issued tokens.
Circulating Supply = the total number of tokens issued to date and are currently available for exchange in the market.
Price = price of a single token in different sales rounds (seed, private, IDO, etc.).
Market capitalization = the token price multiplied by the current supply.
Fully Diluted Market Cap = the theoretical capitalization as if all the project tokens were already in circulation.
In a nutshell, tokenomics sets up the economy of a crypto project by creating incentives for the hodlers and defining the utility of the tokens, a significant factor behind their demand.
To create a successful tokenomics, you need to study all metrics that affect the token's value and create a set of rules and use cases.
Every token has its proper tokenomics, and different projects take different approaches.
$YND is the utility token of Yanda with which you can access the protocol and unlock different features holding it. In addition, you can obtain many benefits thanks to the protocol rewards (airdrop and access to premium features).
You can stake your $YND to help validate transactions and earn a return.
Holding YND allows its hodlers to participate in the DAO governance with the ability to propose changes and vote.
As the image explains, holding YND permit to participate in the DAO and concerning Yanda Protocol.
Users pay fees, and 100% of them are used as buyback to support the model sustainably. This buyback also serves the validators who delegate rewards in YND and receive staking rewards.
The token allocation is divided into different percentages according to the different categories. Respectively:
Regarding circulating supply, here in the chart, you can see the provisions of the token distribution in 3-year.
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