Tokenomics
Last updated
Last updated
The Hydro team has carefully designed tokenomics to ensure sustainability and maximum utility for active users of the protocol. The HDRO token is the native cryptographically-secure fungible protocol token of Hydro Protocol, with attributed utility and governance token within the network. HDRO has a max supply of 1 billion (1x10^9).
The token supply of 1,000,000,000 HDRO tokens have been distributed as follows:
Genesis Incentives | 5% | |
Public Sale | 5% | |
Investors | 10% | 6 months lockup +10% first serve+ linear unlock for 18 months |
Team | 12% | 6 months lockup + linear unlock for 42 months |
Farming | 10% | |
Liquidity Reserve | 10% | |
Treasury | 48% |
The network effects for the HDRO token is directly and wholly correlated with the success of Hydro Protocol as a protocol, whereby there will be greater utility and demand as there are additional users attracted to the network.
Recall that the primary source of revenue that accumulate from the three features are denominated in INJ. Hydro Protocol will be required to convert a portion of those fees to ensure that the HDRO token maintains deep liquidity.
User Rewards Program
As part of the user rewards program, a portion of fees that are collected from the features (up to 30%) will be redistributed to active protocol users as a reward for using and transacting on the protocol, as well as staking to actively participate in governance. Their rewards will be pro-rata for their contribution to platform utility and governance participation.
There will be a 10% annualized performance fee on the Hydro's core features.
As the primary native token, the HDRO token has multiple other uses that can be applied across Hydro Protocol. Some use case examples include:
Amplified yield boosters on Farming: The Hydro Protocol relies heavily on involved users to create a network effect, so HDRO tokens will be allocated as the economic incentives to encourage users to utilise the protocol's services (i.e. "yield boosting") by providing additional HDRO for their efforts.
Components on the RYA index: As the transferrable platform currency, HDRO may be utilised as part of the RYA index which users may utilise as unit of account.
Governance on Hydro Protocol: Users which stake HDRO to receive xHDRO tokens would be able to actively participate in submission, discussions and voting on governance proposals, including without limitation parameter changes, governance parameter changes, treasury deployment, and text proposals.
ADDITIONAL IMPORTANT NOTES ON HDRO HDRO is a functional multi-utility token which will be used as the medium of exchange between participants on Hydro Protocol in a decentralised manner. The goal of introducing HDRO is to provide a convenient and secure mode of payment and settlement between participants who interact within the ecosystem on Hydro Protocol without any intermediaries such as centralised third party entity/institution/credit. It is not, and not intended to be, a medium of exchange accepted by the public (or a section of the public) as payment for goods or services or for the discharge of a debt; nor is it designed or intended to be used by any person as payment for any goods or services whatsoever that are not exclusively provided by the issuer. HDRO does not in any way represent any shareholding, ownership, participation, right, title, or interest in the Company, the Distributor, their respective affiliates, or any other company, enterprise or undertaking, nor will HDRO entitle token holders to any promise of fees, dividends, revenue, profits or investment returns, and are not intended to constitute securities in Panama, Singapore or any relevant jurisdiction. HDRO may only be utilised on Hydro Protocol, and ownership of the same carries no rights, express or implied, other than the right to use HDRO as a means to enable usage of and interaction within Hydro Protocol. The secondary market pricing of HDRO is not dependent on the effort of the Hydro team, and there is no token functionality or scheme designed to control or manipulate such secondary pricing.
For the avoidance of doubt, neither the Company nor the Distributor deals in, or is in the business of buying or selling any virtual asset or digital payment token (including HDRO). Any sale or distribution of tokens would be performed during a restricted initial period solely for the purpose of obtaining project development funds, raising market/brand awareness, as well as community building and social engagement; this is not conducted with any element of repetitiveness or regularity which would constitute a business.
Further, HDRO provides the economic incentives which will be distributed to encourage users to exert efforts towards contribution and participation in the ecosystem on Hydro Protocol, thereby creating a mutually beneficial system where every participant is fairly compensated for its efforts. HDRO is an integral and indispensable part of Hydro Protocol, because without HDRO, there would be no incentive for users to expend resources to participate in activities or provide services for the benefit of the entire ecosystem on Hydro Protocol. Given that additional HDRO will be awarded to a user based only on its actual usage, activity and efforts made on Hydro Protocol and/or proportionate to the frequency and volume of transactions, users of Hydro Protocol and/or holders of HDRO which did not actively participate will not receive any HDRO incentives.
