Here we aim to explain the tokenomics of the $ILV token, rigorously breaking down the total maximum supply, the role to be played by $ILV holders in decentralised governance and supporting the Illuvium game. Additionally, we detail the various mechanisms by which the token is distributed.
#Token Supply Details
Our pre-seed sale was used to fund aggressive growth of the core contributors and allowed the protocol to bring on some of the best in the industry. They were offered 500,000 ILV at $1 USD each. As early stage investors are taking the highest risk, they must be rewarded with the lowest price. All tokens were sold in this round in a matter of days.
Our seed sale was used to further accelerate new hires, audits, listings and all other cumulative costs. The seed sale began on the 15th of January and ran for less than half the allotted time. All 1,500,000 $ILV were distributed at a price of $3 USD.
#Balancer Smart Pool Distribution
A Balancer Liquidity Bootstrapping Pool is designed to allow DeFi protocols to acquire capital from a smaller amount of liquidity than would usually be required when seeding a pool such as Uniswap or Sushiswap. Balancer has been able to solve this through variable weightings of assets. In a regular pool, two assets are matched in value 50:50. In a BLBP, this is different, and the weights change over time to create downward pressure. When the pool goes live, the price will begin to decline, which is why the initial price of the token is set to a high value. There are two competing forces for the price of the token in a BLBP. The changing of the weights of the tokens will naturally push the price of the token down, since the weights start out with the token being worth the majority of the pool’s value, and end up at a much lower level. The other force is trading of the token. As people purchase the token, the number of tokens in the pool decreases, but the value of those tokens must still match the weights, so the price of the token increases to compensate. What you will see is a gradual drop in token price, matched by periodic ‘bumps’ where the token goes back up. In theory, the price should eventually find some value that the overall market finds to be an accurate value for the token. Utilizing Balancer’s Smart Pools we are able to fairly distribute up to a further 1,000,000 tokens that aren’t subject to lockup, listed at an initial price of 50 USD per token.
- Initial Pool Weight Ratio: 96:4
- Final Pool Weight Ratio: 50:50
- Timespan: 72 hours
- Progression: Linear
#Promo NFT Rewards
At the end of the bootstrap, the amount of ETH used for all purchases converts to points at a rate of one point per ETH. These points can be used to redeem promo NFTs that will only be available for a short period of time following the sale. This applies only to those who hold all of their ILV purchases after the sale concludes until the NFTs redeem window is closed.
The full list of NFTs redeemable in the BLP sale will be viewable in a follow up medium post prior to the BLP opening.
The Rhamphyre NFTs are purely promotional. This means that they are not used in-game. However, this also means that they have a strictly limited supply. Once the claim period ends, no more will ever be minted.
The M0z4rt Skins, Emotes, and Badges are functional in-game, via redemption once the game goes live. They can be traded on any market prior to launch, but to be used in-game you must own the NFT in your linked wallet, and then redeem them in-game which will burn the NFT.
Badges do not cost points, they simply have a points threshold. The bronze badge has a points threshold of 0, which means any purchase size in the sale is enough to claim this badge.