Tokenomics
- 3. History of CryptoCurrencies 2008: Satoshi Nakamoto, Bitcoin 1982: David Chaum, e-Cash and DigiCash 1997: Adam Back, HashCash 1998: Wei Dai, B-Money 1998: Nick Szabo, Bit Gold 2004: Hal Finey, RPOW
- 4. VC Investment in BlockChain Health • BIS research estimates – Current (2018) • $176.8M – By the end of 2025 • $5.61B Blockchain Capital Andreessen Horowitz Draper Associates Boost VC Polychain CapitalSequoia
- 5. BlockChain Eco-System & Tokens Creating a token strategy. - What is the application - Is it a dApp? - Is it a third party application communicating to the networking layer or nodes via API calls? - Has there been changes to the way the private key issue and storage through the design? - Is there enough talent to develop tokens? - ERC20 is really easy. - NEP-5 from NEO? Public or Private protocol?
- 6. Four types of Tokens • Currency — A payment method between participants. • Asset backed — A claim to an asset that is fungible and tradable – SECURITY TOKEN – E.g. – Tokenised building in Brooklyn – the Brooklyn project by consensys • Grease the Wheels — The token is needed to power the blockchain – Incentivise NODES to keep consensus going. • Equity — A “stake” or ownership in the company. – E.g. ICO replacing the IPO. – SECURITY TOKEN
- 7. Sample ERC-20 token code
- 8. Example Token strategy Strategy #1 – Single Utility Token • dApp • Simple ERC-20 tokens (ETH) • Issue as many for use within the dApp – i.e. Utility function • Do an ICO • Make a tonne of cash and hide in the Bahamas Strategy #2 – Two Tokens – Utility and Security • dApp • Security Token offer for company shares – Must comply with securities acts within each jurisdiction. E.g. ASIC – Security Token offer for company shares • Utility Token offer to use within the dApp – Tokenomics become important. • E.g. a loyalty program structure with rewards, redemptions and purchases within the dApp
- 9. Token Classification Framework: Untitled-Inc
- 10. Token Classification Framework: Example You could call Augur’s REP a Non-native- protocol- Network- Network-value- Work token likely classify as a Utility Token.
- 11. Things to consider when tokenising your dApp • Does the dApp need a token to function? • Does the Blockchain require tokens? – i.e Public vs Private • What is your token strategy? • Have you created a tokenomics document? (example to follow) • Consider legal ramifications based on jurisdictions e.g. Token classification & Compliance • Hire the best developer you can possibly buy • Lots of nightmare stories with coding errors in Tokens. Critical for the success of your dApp Next step: The ICO • PR, Marketing, Pre-ICO raising via private pools, Exchange listing negotiations, Market making from liquidity providers, in-house trading desk, on going compliance etc…………………
- 12. Tokenomics Doc example: E-Nome • E-Nome Tokenomics summary • E-Nome system Token flow and Data Transfer Tokenomics = Economics+Your Token
- 13. • E-Nome Token structure – Dual token: A Tokens (Nomes - CryptoCurrency) and B Tokens (Health Points – data collection) • Conversion of B Tokens to A Tokens via smart contract in the incentivization process • Nome Escrow for creating in-house loyalty programs and converting A tokens back to B tokens • Token allocation and availability breakdown Tokenomics Doc example: E-Nome
- 14. ICO Analysis framework: Untitled-Inc
- 15. Amazon – Healthcare and Blockchain as a service platform Google Health – Largest Investor in to Blockchain projects overall Apple Healthcare – Filed for patents in December 2017 for Blockchain timestamp verification system IBM – Watson and Involvement in Hyperledger Tencent – Blockchain as a Service (BaaS) AliBaba – Heavy involvement in Blockchain application development and protocol development Microsoft – Azure Blockchain Workbench (BaaS) What are the Tech Giants upto? Will they become competitors or complementors?
- 16. Please get in touch linkedin.com/in/g-samarakoon/