WOO to lock final $45 million in tokens behind key milestones, initiating decentralized treasury management
The WOO tokenomics revamp, marking the end of the token supply phase, was in response to outcries over overspending in high-profile cases like Polkadot and the Ethereum Foundation.
VICTORIA, Seychelles, Sept. 04, 2024 (GLOBE NEWSWIRE) — WOO Ecosystem announces the locking of its final $45 million worth of WOO tokens in the treasury, marking the conclusion of its token supply phase and the beginning of a new era under decentralized treasury management.
This strategic move completes WOO’s tokenomics overhaul which started in January 2023, as WOO positions the ecosystem with a robust token supply structure. With the final tokens locked, WOO will now focus on engaging the community and involving the ecosystem in key strategic decisions.
To access these tokens, milestones require implementing token-based governance and achieving ambitious targets for the fully diluted market cap. If both milestones are not met, the tokens remain locked, effectively removing them from the supply. If the tokens are unlocked, it indicates that the team has successfully created value for all stakeholders and has secured additional funds, under decentralized governance, to drive further growth.
“Traditional time-based vesting models often lead to inflation and misalignment with ecosystem performance. Especially in light of recent high-profile overspending by the Ethereum Foundation and Polkadot, we realized that proactively reducing uncertainty and pushing for decentralized oversight was the best practice. Our revamped milestones-based tokenomics addresses these issues by linking token release to specific milestones and incorporating decentralized governance to ensure community oversight and alignment with our strategic goals,” said Ben Yorke, VP of Ecosystem at WOO.
The innovation in WOO’s revamped tokenomics addresses legacy issues related to inflation and unpredictability in token supply. Initially, WOO used a time-based vesting system, which could lead to unpredictable token issuance and potential inflation.
To resolve this, WOO has adopted a milestones-based vesting model. Under this system, surplus tokens are locked and will only be unlocked when specific milestones—based on the token’s fully diluted valuation (FDV)—are achieved. This method requires the establishment of a decentralized governance system to oversee token releases. By linking token issuance to concrete performance targets and governance structures, this approach enhances transparency and ensures that token distribution aligns with the ecosystem’s growth and stability goals, thereby reducing concerns about inflation and token overhang.
The new tokenomics structure reflects WOO’s commitment to transparency and decentralization, ensuring that all future developments and decisions are made with active community participation. This initiative sets the stage for sustained growth and innovation within the WOO.
“With the incredible influx of new tokens and relatively stagnant retail demand, fundamental tokenomics metrics are under increased scrutiny. Many new projects are still launching with less than 10% of the supply in circulation, meaning retail investors need to absorb years of time-based inflation to maintain the price, which just isn’t realistic. As investors observe more of these cases, we believe they will seek out mature second-cycle projects with low overhang and transparent governance around treasury management,” Yorke further noted.
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