A Brief Introduction to Take Finance Tokenomics Model
Thankfully, the blockchain industry has since moved on, learning from the mistakes of the past — or at least hopefully. Decentralized finance is now the latest trend in the space, giving rise to DeFi protocols with better token design and much more impressive tokenomics. Take Finance is one such DeFi protocol leveraging smart contract functionality and innovative tokenomics to provide lending, staking and liquidity mining solutions to everyday users.
The Take Finance blockchain is a self-sustaining decentralized financial ecosystem consisting of lenders, borrowers, liquidity providers, investors and the native token TAKE. This setup of major players on the Take blockchain seems similar to many DeFi protocols, but there are key differences which help the protocol to maintain a healthy tokenomics system.
We’ve provided a quick breakdown of the TAKE token distribution below.
Total supply: 1,000,000 TAKE (fixed supply)
Liquidity Mining Rewards: 50% (500,000 TAKE)
Bonding Curve Offering: 20% (200,000 TAKE)
Development Fund, with a lock-up period of two years: 22% (220,000 TAKE) 2 Years lock up
Uniswap Pool: 7% (70,000 TAKE)
Marketing: 1% (10000 TAKE)
TAKE Token Supply and Inflation
TAKE has a fixed maximum supply of 1 million tokens. Upon launch, up to 200,000 TAKE will be released initially into the circulating supply. This is meant to provide liquidity for the TAKE token through the initial bonding curve offering, thereby preventing a liquidity shortage.
One of the problems with cryptocurrencies is their huge price volatility. Take Finance has some measures put in place to prevent a dump during large price up (or down) swings in the crypto markets. Most notably, the economic model is aimed at burning tokens from circulation, as well as maintaining a stable price of the TAKE token. In addition, the liquidity model is designed to stop the distribution of rewards to LPs when the price of TAKE is lower than the bonding curve price divided by two.
During the bonding curve offering, if a user decides to sell their tokens on Uniswap, 10% of the total TAKE sold will be burnt from circulating supply. This is a temporary measure designed to prevent inflation in the token price and it will remain in place until after the token offering when the price becomes stable. Also, the total amount of fees paid in TAKE is sent back to the buyback and that same amount will be burnt from the liquidity pool.
Based on previous events, we now know for a fact that token functions are significant in determining healthy tokenomics and consequently, competitive market prices of tokens. These structures help to delineate the value of tokens and determine the economic correlation between a token’s function and its price.
To that end, here’s a breakdown of how the TAKE token is used in the ecosystem. TAKE demonstrates strong tokenomics by performing three distinct functions: distribution of liquidity rewards, payment of fees and participation in on-chain governance.
On TAKE Finance, holders of DeFi tokens like Dai, USDC, USDT, ETH and of course TAKE can contribute to the corresponding liquidity pool to receive rewards and earn interest — all disbursed in TAKE tokens.
Finally, holders of TAKE will earn the power to vote on key decisions and suggest proposals regarding the protocol. This will put users back in driving seat and help maintain an open, decentralized ecosystem.
Ideally, designing the tokenomics of the token should hinge on usage, usability, and value. In a bid to bolster a self-sustaining ecosystem, TAKE Finance allocates the appropriate precedence to this economic trifecta to ensure a healthy tokenomics system.