Highlights

  1. The conventional approach of the “private token vesting model” is not ideal broken.
  2. The precursors; BTC “proof of work” and “options token” by Andre Cronje
  3. Maiga AI “Proof of Trading” token model

The traditional approaches to token distribution are becoming obsolete. Investors, including Key Opinion Leaders (KOLs) and Venture Capitalists (VCs), aim to maximise their return on investment (ROI) during Token Generation Events (TGEs), while retail investors are increasingly skeptical of this narrative.

  1. Time-based vesting is often perceived as arbitrary, serving primarily to deter investors from dumping tokens immediately after receiving them.
  2. The secondary market, encompassing public markets, liquid secondary funds, and retail investors, is exhibiting reduced enthusiasm for tokens characterised by "low float, high FDV" tokenomics compared to previous periods.
  3. The absence of buying power, coupled with consistent selling pressure from early buyers and private investors, leads to downward price trends, which can be detrimental to the industry and project. This negative cycle perpetuates fear, uncertainty, and doubt (FUD), creating an unsustainable loop.

<aside> 💡

What if token vesting is replaced by “Proof of Trading” as a token vesting mechanism?

</aside>

The Maiga.ai "Proof of Trading" (PoT) token model is designed to create a sustainable and speculation-driven ecosystem for the MAIGA token by incentivising active trading volume while mitigating risks of market manipulation.

This model introduces the oMAIGA token, a derivative option token of MAIGA, which unlocks based on a combination of 7d trading volume and buy/sell ratio metrics. The model integrates real-time decentralised (DEX) and centralised (CEX) trading data, employs anti-manipulation safeguards, and uses Monte Carlo simulations to optimise incentives while ensuring long-term liquidity and fair price discovery.

The precursors

  1. Bitcoin’s $BTC proof of work vs MAIGA’s proof of trading
    1. Requires significant computational power, leading to high energy consumption (cost of energy). PoW consensus mechanism limits the transaction throughput, higher number of transactions, higher the network faces congestion and higher transaction fees.
    2. Miners receive BTC as a reward for solving the SHA256 hashing algorithm. This incentive motivates miners to continuously participate in the Bitcoin network, thus, securing its network.
    3. MAIGA’s proof of trading (PoT) uses “cost of capital” as a mechanism for token model, therefore, ensuring token volume performance and network participants receives the benefits from this novel approach.