Tokenomics and Governance
Last updated
Last updated
The Superblock Protocol has a robust tokenomics model and a decentralized governance system that play vital roles in the stability, growth, and long-term sustainability of the ecosystem. This section provides an overview of the SBX token and its value proposition, token distribution, governance mechanisms, and the role of stakeholders within the ecosystem.
The SBX token is the governance and value-accrual token in the Superblock Protocol. However, governance rights are activated when SBX tokens are staked to obtain vSBX, emphasizing the protocol’s commitment to active and responsible governance participation. While USDx remains stable at a value of $1, the SBX token is designed to be volatile and serves as an investment asset with the potential for both upside and downside. As the market cap of SBX increases, it signifies the net value creation from the seigniorage of USDx tokens in perpetuity and the value accrued from governance decisions.
Superblock Ether (ETHx) is the native gas token of the Superblock blockchain, essential for all transaction fees within the ecosystem. ETHx can be acquired by bridging ETH or ETHx (ERC20) from Ethereum to Superblock. When users bridge back to Ethereum, they receive ETHx as an ERC20 token. ETHx supports the seamless operation and scalability of the Superblock network and integrates smoothly with other tokens like USDx and SBX.
The SBX token's value accrual mechanism is one of its key features. As the collateral ratio decreases, more SBX tokens are required to expand the USDx supply since less collateral is used. This compounding effect drives demand for SBX tokens as the system grows, potentially making them exponentially valuable in the long-term. The scarcity of SBX tokens, resulting from burning mechanisms and deflationary design, further enhances their value proposition and potential upside.
SBX token holders play a crucial role in the governance of the Superblock Protocol. Staked SBX holders have the right to participate in the decision-making process, including voting on governance proposals, system upgrades, price feed oracles, and potential forks. The governance system is designed to be decentralized and community-driven, ensuring that decisions are made in the best interest of the ecosystem as a whole. Token holders can actively contribute to the evolution of the protocol and shape its future direction. ETHx, while not a governance token, underpins the network’s operation by enabling efficient transaction processing, which is vital for the seamless execution of governance decisions and protocol upgrades.
The initial supply of SBX tokens is set at 200 billion at genesis, with 100 billion allocated for the burn reserve. The distribution strategy is designed to incentivize early adopters and foster active participation in the ecosystem's growth.
The SBX tokens are allocated as follows:
Allocation
Participant
Description
25%
Community and Marketing
Dedicated to growing and engaging the community and driving adoption
20%
Treasury, Grants, Partnerships, Security
Reserved for strategic partnerships, grants, and maintaining a healthy treasury
35%
Team
Core team members, future hires, strategic advisors, outside early contributors
10%
Private investors
Private investors who provided early-stage funding
10%
Reserved/Ecosystem Growth
Funds reserved for future development, expansion, unforeseen expenses
This allocation ensures a fair and balanced distribution of tokens, providing a strong foundation for the growth and development of the Superblock Protocol.
SBX token holders have several opportunities to earn revenue and benefits within the Superblock Protocol ecosystem. First, SBX holders can earn revenue through a 0.25% trading fee charged on the USDx/USDC pool on decentralized exchanges, such as Uniswap. This fee is split between liquidity providers and SBX token holders, allowing them to earn a share of the trading volume in the pool. Second, USDx holders can also earn revenue through arbitrage opportunities that arise when the price of USDx deviates from its peg. By buying USDx at a discount and trading it on the open market, traders can take advantage of these opportunities. Additionally, Livepay charges a 1% transaction fee for processing payments through its crypto payment gateway, contributing to the revenue of the Superblock Protocol.
The tokenomics of the Superblock Protocol include a deflationary design to increase the value of the SBX token over time. As the protocol matures and stabilizes, a higher proportion of the token supply will be allocated to liquidity providers and USDx minters, creating a more deflationary distribution. Additionally, the Livepay crypto payment gateway plans to use 20% of its profits each quarter to implement a repurchase and burning program. Through this program, Livepay will buy back SBX tokens from the market and burn them, effectively reducing the total supply of tokens. The repurchase and burning program will continue until 100 billion SBX tokens have been burned, leaving a total supply of 100 billion SBX tokens. This deflationary mechanism reduces the overall supply of SBX tokens, potentially increasing the value of each remaining token and aligning incentives for long-term holders.
In the future, the Superblock Protocol plans to expand its offering by introducing additional stablecoins. These stablecoins, such as AUDx, GBPx, EURx and others, will be based on the same economic design and principles as USDx. The expansion to other stablecoins will enhance the utility and reach of the protocol, providing users with more options for stablecoin use and investment. It will also contribute to the protocol's growth and adoption, as a broader range of stablecoins attracts a larger user base and increases the overall liquidity of the ecosystem.
By expanding to other stablecoins, the Superblock Protocol aims to cater to a wider range of markets and user preferences. Each stablecoin will maintain the same stability, decentralization, and robustness as USDx, offering users a consistent experience across different currency denominations. The expansion to other stablecoins aligns with the protocol's mission to provide a comprehensive and versatile stablecoin ecosystem that can cater to the diverse needs of global users.
Overall, the tokenomics and governance of the Superblock Protocol provide a solid foundation for the growth, stability, and long-term success of the ecosystem. By highlighting the value proposition of the SBX token, explaining the benefits for USDx holders, and discussing the token distribution, governance mechanisms, and incentives, this section aims to provide a comprehensive understanding of the tokenomics and governance framework.
Through staking SBX tokens to obtain vSBX, participants have the opportunity to actively participate in the governance of the protocol, earn rewards through various mechanisms, and benefit from the growth and success of the ecosystem. The Superblock Protocol strives to create a sustainable and valuable ecosystem where token holders are incentivized to contribute, engage, and hold their tokens for long-term value appreciation.
As the Superblock Protocol expands its ecosystem, explores new partnerships, and introduces additional stablecoins, it aims to revolutionize the stablecoin market and transform the global financial system. The protocol's commitment to transparency, decentralization, and community-driven governance ensures that the interests of token holders are aligned with the overall success and stability of the ecosystem.
In summary, the Superblock Protocol's tokenomics and governance framework create an environment where participants can actively engage in decision-making, earn rewards, and benefit from the growth of the ecosystem. By leveraging the value accrual mechanisms, incentives for liquidity provision, and the deflationary design, the protocol aims to create a thriving ecosystem that attracts users, liquidity, and value.
