Analysis on CHAIR’s Token Distribution and Appreciation Mechanism
As is known to all, a token system can provide the indispensable economic incentives to increase collaboration efficiency and bring prosperity to any large scale DeFi platform. In the previous article we have introduced the CHAIR platform, world’s first decentralized exchange for utility NFTs. Today we will talk about its platform token — BNCH.
BNCH holders can exchange products and services on the CHAIR platform. They also can have in-depth participation in the future development and governance of CHAIR as well as sharing the platform revenues.
The total issuance of BNCH is 70 million. There will be no private placement. Instead, all BNCH will be distributed to CHAIR backers by NFT purchases.
1. The first batch of utility NFTs for sale will be 2.1 million tokens, accounting for 3% of the total BNCH amount. This 3% portion will be sold in two separate phases. The first phase will release 1.4 million BNCH (2%) and the second phase will release 700,000 BNCH (1%).
Each NFT represents the corresponding tokenized rights and benefits proportional to the USDT amount paid. These 2.1 million BNCH tokens are to be released evenly over 8 quarters.
2. The second batch of utility NFTs for sale will be 7 million tokens, accounting for 10% of the total BNCH amount. Each NFT represents the corresponding tokenized rights and benefits proportional to the USDT amount paid. These 7 million BNCH tokens are to be released evenly over 5 quarters.
Backers who have purchased the BNCH NFT will enjoy priority to airdrops as well as the platform governance rights, development and voting rights etc.
3. The developer team will receive 10% of the total BNCH amount which is about 7 million. These 7 million BNCH tokens are to be released evenly over 14 quarters.
4. Tokens assigned as mining rewards will account for 50% of the total BNCH amount. Users can participate in behavioral mining (such as transactions and auctions), liquidity mining and locked position mining to receive BNCH mining rewards.
5. 15% of tokens will be reserved for the community ecosystem construction, and another 12% BNCH tokens will be reserved for future planning and risk management.
From the above economic model of BNCH, we can see that the lock-up period of the developer team is the longest — 14 quarters. Their token portion is also released after the investors. Their confidence and responsible stance for the project is obvious. BNCH is expected to be listed on decentralized exchanges in early June, this is a great opportunity for early investors. For promising projects such as CHAIR, the earlier you enter the market, the more profits you will gain.
First INO by Chair
Most blockchain projects employ a lock-up mechanism because the lock-up period can keep the token price stable, providing a longer development time frame for the project and creating a win-win situation for both the investors and the project owners.. CHAIR has a 15 months lock-up period for investors and it’s to be unlocked by 6 installments over 5 quarters. The first release will only unlock 5% of the BNCH tokens.
However, there are also risks with BNCH’s mechanism since the market is changing rapidly. Currently in this bull market, both price situation and investor emotion have reached the tipping point. Some investors have indulged themselves in the pleasure of trading in the secondary market.
Chair’s innovative INO mechanism is the first of its kind in the NFT industry. It can perfectly solve the issues related to lock-up and monetization, hence optimize the circulation of locked assets.
INO is short for Initial NFT Offering. It tokenizes locked cryptoassets into NFT. For instance, the locking period is 15 months on CHAIR. The locked BNCH tokens will be released in a total of six rounds over five quarters. 5% of the locked portion is released in the first quarter. The price of CHAIR platform tokens is expected to soar by at least 20 times. If an investor sells 5% of his unlocked portion, his initial investment cost will be recouped immediately. The rest of the locked portion can be tokenized into an NFT. Then the investor can trade the NFT on the CHAIR platform at a price three or five times higher than the initial value to earn the price premium.
INO allows locked assets to be freely traded and circulated, which perfectly reflects the core value of the digital economy.
This creative model not only guarantees the scheduled release of tokens but also contributes to the increase of token price and provides investors with more options. Whether an investor chooses to hold the token or monetize it by selling it, CHAIR’s INO mechanism will always reduce the investment risks.
In terms of its economic model, lock-up mechanism and INO model, CHAIR is an excellent NFT project. CHAIR’s development team always puts investors’ rights and benefits first!
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