Unido’s Burn & Recycle Model
Unido’s native token, UDO, is at the heart of the Unido ecosystem and is designed to be highly flexible, enabling it to be utilised for a variety of new products that are expected to be built on top of Unido Core.
As such, a key aim of the UDO token is to capture the value created within Unido such that the UDO token’s value will reflect the increase in network usage. At its core, the UDO token has three primary utilities that give it value:
- Platform Access: UDO must be staked on a /user and /enterprise basis to secure access licences to the Unido ecosystem — this involves Unido’s first product — the Enterprise Platform, Unido Core and 3rd party dApps that will be developed on Unido Core. The bigger the enterprise, the more access licenses will be needed to be purchased and more UDO is locked up.
- Consumption Fees: Transactions taking place on Unido will charge a small fee in UDO based on a FIAT value e.g. if monthly volume of transactions equates to $100/month, the equivalent will be paid to the Unido Treasury using UDO, however the price will be dynamic and adjusted based on market supply and demand.
- DAO Governance: The Ecosystem Development Fund designed to subsidize 3rd party projects building using Unido Core, will be governed by a DAO whose users must stake UDO to participate in the election process and vote on proposals.
However, in the early stages of ecosystem development it will be important to ensure that (1) early token holders are rewarded for their support, and (2) a mechanism is in place to support the stability of the UDO token as the network growth accelerates.
A key objective is to support the stability of the network and UDO token in the early stages of adoption. To achieve this, we have created a Burn & Recycle Programme for the UDO token that will reduce total supply by 20% from 115 million to 92 million, similar to the burn programme we have seen implemented by Binance which has helped their token appreciate over 4200%.
In Phase 1 of this model, we intend to burn 60% of UDO fees collected through “Consumption Fees’’ on a quarterly basis, until such a point that the overall token supply is reduced 92,000,000 UDO tokens.
After this point is reached, Phase 2 will commence where the “Burn” mechanic will turn into a “Recycle” mechanic, where no further tokens collected from “Consumption Fees” will be burnt, but rather 50% distributed to the “Reserve” to support ongoing development and network maintenance of Unido Core and the remaining 50% distributed to the Ecosystem Development Fund to continue subsidising the growth of 3rd party applications in the ecosystem.
The amount of time it takes for this pivot point to occur will depend on the adoption rate of the Unido Enterprise Platform and Unido Core API.