The UDO token is designed to be highly flexible, enabling it to be utilized for a variety of new products that are expected to be built on top of Unido Core. As such, a key aim of the UDO token is to capture the value created within Unido such that the UDO token’s value will reflect the increase in network usage. However, in the early stages of ecosystem development it will be important to ensure that (1) there is a healthy distribution amongst token holders (2) early token holders are rewarded for their support, and (3) a mechanism is in place to support the stability of the UDO token as the network growth accelerates.
Two programs will be implemented to achieve these objectives:
A portion of the UDO supply will be unlocked through liquidity mining. The objective is to create a long-term incentive program that enables a fairer distribution of the UDO token to long-term supporters of Unido. These long-term supporters will have provided support via liquidity provisioning in the early stages of the project, in contrast to investors who happen to be early but have since renounced their stake in the Unido.
Upon launch of the liquidity mining program, participants will be able to mine this supply by staking LP in the UDO/ETH or UDO/USDT liquidity mining pools.
Mining rewards will dynamically be adjusted based on the volume of liquidity provided, decreasing in a positive correlation to the number of users & liquidity provided.
Details of the Liquidity Mining program will be provided at a later date.
A key objective is to support the stability of the network and UDO token in the early stages of adoption. To do so, Unido will implement a “Burn / Recycle model” for the Unido Enterprise Platform.
In Phase 1 of this model, we intend to burn 60% of UDO fees collected through “Consumption Fees’’ on a quarterly basis, until such a point that the overall token supply is reduced from 115,000,000 by 20% to 92,000,000. After this point is reached, Phase 2 will commence where the “Burn” mechanic will turn into a “Recycle” mechanic, where no further tokens collected from “Consumption Fees” will be burnt, but rather 50% distributed to the Reserve to support ongoing development and network maintenance by PAC, with the remaining 50% distributed to the EDF to continue support of the Unido user community.
The amount of time it takes for this pivot point to occur will depend on the adoption rate of the Unido Enterprise Platform and Unido Core API.