Major Tokenomics Changes in $DFYN token
The mother of all Burns is here.. 50,000,000 $DFYN tokens will be burnt…
Dfyn is happy to announce a major tokenomics revision. The revision is an upgrade that will greatly benefit the $DFYN community around the world and the continued development of the ecosystem.
Dfyn Exchange was the first AMM on Polygon and was launched in 2020. It has been six months since we introduced the $DFYN token to start one of the largest liquidity mining programs in existence. The exchange has since hit multiple milestones:-
- Reached almost $300 million in TVL at peak
- Processed over $3 billion in trades
- Established close partnerships with industry leaders
- Launched on multiple chains including Polygon and Fantom
Dfyn has been one of the top Dapps on the Polygon ecosystem, and Dfyn continues to be one of the top DEXes globally, ranked among the top 20 to 40 places continuously on both Coingecko and CMCO, with occasional surges taking the ranking as high as the 12th largest DEX globally based on trading volume.
As we grow, it’s our responsibility to grow responsibly, and be aware of changing market conditions, especially in DeFi, where rapid change is the constant reality.
One thing we have been mindful of is controlling Dfyn token emissions. Some of the key farm design aspects to address inflationary pressures have been as follows;
- Our initial strategy to offer vested rewards to our liquidity providers in the farming cycle proved beneficial — we are the first exchange with vested liquidity mining rewards that ensured a flywheel effect in liquidity, wherein the liquidity providers could continue to add liquidity and earn attractive APRs without immediately selling their reward tokens. The idea behind keeping the rewards vested for longer durations is embedded in our DNA which focuses on long-term operations. This model is now being replicated across a number of other projects and is a great way to align the long-term incentives for the project and community.
- We have been designing multiple incentives to ensure that we are reducing our emissions across our farms while maintaining our TVL — for example, recently dual farm partnerships introduced at DFYN have a different reward ratio than the 1:1 ratio we used to do earlier. What that means is — instead of matching rewards 1:1 by partner projects, we are making that ratio 1:2 to 1:5 where for every 1$ worth of reward given by Dfyn, 2–5$ worth of rewards come from the partner projects.
- Recently, we introduced a new category of farms — Launch Farms, where the rewards are in the partner token projects. This way we have been adding more communities not just to Dfyn but to the entire Polygon ecosystem. So far Dfyn has helped over 50 projects map their tokens on Polygon and be part of the growing Dfyn ecosystem within the broader Polygon ecosystem. Whenever we partner with a new project, their entire community gets exposure to our community and suite of products and vice-versa. This effectively allows us to scale our visibility across various projects while also providing the Dfyn community an opportunity to participate in farming events of great projects.
This is just the beginning of our efforts to make DFYN better. We are constantly benchmarking with the best DEXes globally across aspects such as capital efficiency, user experience, and overall feature mix.
And now, for some analysis of the proposed token burn…
The first major change being introduced is a 20% quantity rebase across all categories in our tokenomics. The effective total supply will reduce from 250 Million to 200 Million, as 50 Million tokens will be burnt across all categories of the tokenomics — All categories, Ecosystem fund, Partners & Advisors, NFT Airdrops, Liquidity Provision Fund, Team, Seed, and Private Sale will see their tokens reduced by 20%. The only category which is not affected by this rebase is the public sale because it has already been concluded.
The 20% rebase is applicable to all the tokens — not just the unvested ones. For example, if a category has had 40% of tokens vested till today and has 60% of tokens remaining — they will only get another 40% and the remaining 20% of the tokens will be burnt. The rebase will disproportionately benefit those who have held onto their tokens as with the rebase kicking in — their tokens are 20% more scarce than they were yesterday.
Private sale Investors originally had 12 months of vesting while seed investors had 15 months vesting — both of them are being revised now to 2 years vesting. We are glad to have the support of our invaluable investors who have been with us from the very beginning and have been standing next to the team as DFYN continues to evolve and mature into the next phase of its growth. It is also worth highlighting that the team and partners/advisors have a 3-year vesting cycle and the team has received no tokens in the first six months.
Combined — the rebase and the vesting delay will ensure that we will reduce almost one-third of the inflation we are seeing currently. Lowered inflation will ensure that the token is able to sustain value and be judiciously used in programs such as liquidity incentives that are critical for partnerships with various projects, as well as for expansion into other chains,
The elongated vesting periods will also ensure that most of our users and investors are part of our journey as we enable a cross-chain exchange and launch the integration with Router Protocol’s XCLP to enable cross-chain swaps. The long vesting will ensure that the majority of our growing supporter base is incentivized as Dfyn traverses the exciting arc from promise to potential.
Our recently introduced vDFYN vaults which allow our community members to stake their DFYN tokens and earn protocol fees now have over 6 million DFYN tokens staked in it — which represent more than 15% of DFYN’s circulating supply. The vDfyn vaults have become self-sustainable and the rewards are only funded by the protocol fees — this is a key metric, proof that we are on the right path. The vDFYN vaults are an excellent opportunity for anyone who holds DFYN tokens — currently, the vaults are at over 75% APR. The vDFYN vaults additionally allow any time entry/exit.
We appreciate the community’s support over the past year and look forward to continuing to innovate with Dfyn. While token burns and other techniques are definitely welcome, it is our aim to continuously push the needle on true product innovation. To this end, some of the exciting product upgrades that we hope to see in the next quarter include the following;
- Integration with Router cross-chain infrastructure, along with Router’s impending mainnet launch
- Allied to the above, Dfyn’s expansion across key blockchain nodes, continuing on from the current key nodes on Polygon and FTM
- An upcoming Dfyn v2 focused on driving capital efficiency, as well as a better interface with the limit order capabilities to appeal to institutional traders
- Additional strategic partnerships that continue to build out the Dfyn and broader ecosystem on Polygon, Fantom, and other chains that we have a presence in
The proposed changes to the tokenomics and vesting schedule will go a long way towards helping the Dfyn team deliver effectively on this roadmap. We cannot be more excited about the future of Dfyn and hope we continue to have the Dfyn community’s support.
Dfyn is a multi-chain AMM DEX currently functional on the Polygon and Fantom networks. Dfyn nodes on various chains act as liquidity entry and exit points into the cross-chain liquidity super mesh that is being enabled by Router Protocol.
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Telegram Announcements: https://t.me/dfynofficial