♻️From Static to Dynamic Supply Tokens
Towards dynamic and adaptive token economies
In the early days of crypto and initial coin offerings (ICOs), many projects and decentralized autonomous organizations (DAOs) launched static supply tokens which struggled to expand and contract with bull and bear market swings, and are not adaptive enough for the dynamic nature of these nascent economies. This has also been a huge challenge for token valuations, with many DAOs and organizations seeing massive selloffs and price drops in the 90%+ range. When token price is a primary driver of the capacity to carry out work in a DAO ecosystem, volatile token prices are a hindrance to production in Web3 organizations.
Many DAOs and organizations are looking to move from static supply to dynamic supply models to reduce volatility and create more adaptive and generative token economies. In this article, we explore the ramifications of the evolution in token design to dynamic supply tokens employing primary automated market makers via bonding curves, and why adaptive, breathing economies are the next evolution in token economics:
Last updated
