Tokenomics
Backstory
The team of ENERGYBLOCKS came from the WAX Blockchain, the highest user volume chain for NFT transactions globally. A large amount of projects and P2E games were launched in that blockchain, some generating multiple hundreds of millions of USD of volume.
Many of these P2E games, had very strong development teams behind , with a lot of invested capital which resulted in engaging and appealing games to a broad audience.
The major flaw we saw and predicted in all of these P2E games, was one major crucial factor: The Tokenomics.
All of these games had decided to run free-floating tradeable tokens on the open market exchange hoping that the balancing mechanisms of their in game tokenomics would see a token which withheld value in the long term, irrespective of market conditions.
Nevertheless, these Tokenomic models didn’t account for certain key variables:
Will variation in the player base affect the token value?
Will the economics of the token sustain prolonged and negative overall cryptocurrency market conditions?
Will the % of the token owned by certain holders, significantly influence the value of the token when traded?
Are the inflation/deflation mechanics of the token correctly balanced to withhold token value?
This resulted in many P2E games that had seen their token appreciate greatly in a short time span (given player adoption) and crash severely shortly after. With the majority of these tokens ending up devalued between -95% to -99% without ever recovering the losses.
This left the players of these games with huge personal losses, mistrust in the game, the blockchain , their game developers and the overall P2E ecosystem. Due to it the game player participation would dwindle massively and the project would fail as a consequence.
This we saw in WAX and in many other blockchains, even today with multiple popular P2E games which still haven’t resolved those key variables mentioned above.
As a pre-condition to begin to develop the ENERBYLOCKS game, our team made it mandatory to guarantee that our P2E blockchain game would have a tokenomics model that was completely self-sustaining and balanced and that neither market variables, % of player token ownership , players-base variations or inflation/deflation dynamics would alter the value of the base game token in the short term, medium or long term.
E-BLOCKS Token (EB)
To ensure the ENERGYBLOCKS ecosystem functions on a token which maintains its value at all times, the E-BLOCKS token (EB) is pegged to the USDC stablecoin at a ratio of 100 EB : 1 USDC.
The EB token is innate to the ENERGYBLOCKS platform and cannot be traded on open market.
To play on ENERGYBLOCKS, players can easily convert USDC to EB and start playing straight away.
The peg of EB to USDC allows players to find constant market stability at the time of buying, holding, playing with, and selling EB. Which enables an ecosystem for players where the volatility of the crypto market does not influence their earnings, ensuring constant price stability.
Self-Sustainable Tokenomics
The Tokenomics of ENERGYBLOCKS are very simple. The total liquidity pool of the token is entirely dependent on the following equation:
EB Purchase [Deposit] = (EB Sale [Withdrawal] – Platform Commission)
There is only as many EB tokens created and in existence within the pool as purchases of that token made through the platform. The ENERGYBLOCKS game does not create more tokens that those which are provided through the purchase of EB with USDC.
When a player purchases EB using the USDC stablecoin, that USDC goes to the platform Liquidity Pool.
When a player sells their EB back to the platform in exchange for USDC stablecoin in return, the USDC is withdrawn from the platform Liquidity Pool and those EB tokens are burnt (deflationary stability).
Liquidity Provision
The entry and exit of the USDC stablecoin within the platform and the creation / burning of the EB token based on that transaction, enables ENERGYBLOCKS to have a liquidity pool which is constantly available to provide liquidity to all players, without constraints.
The platform liquidity architecture and blockchain contracts developed around it are designed to automatically provide entry/exit liquidity at all times.
The stability of the token and the tokenomics enable the platform to be constantly in a net asset/liability balance which allows players to join and leave the platform at any time without any variation in the value of their tokens and with guaranteed liquidity at both the time of purchase/deposit and sale/withdrawal.
Contrary to other P2E games, the variation of players within the platform does not influence the value of the token or the ability to always provide liquidity to all players by the platform.
In the scenario that ENERGYBLOCKS was to see a sudden sharp decreasing trend in the player base, this would only see a decrease in commission for ENERGYBLOCKS as a company but the EB token would still withhold all of its value relative to USDC and the liquidity pool would still be able to instantly provide entry and exit to the token. This protects all players of the platform from any adversity and provides a Play-To-Earn ecosystem with assured constant stability for the economics and token transactions of the game.
Platform Fees
In the similar way an exchange like OpenSea or Magic Eden generates their income through escrow fees on the trades done within their platform, ENERGYBLOCKS as the game host applies a 5% fee on all games played on our platform.
The platform also takes a 2.5% fee from EB sales/withdrawals for USDC to cover blockchain fees and operational costs, limited to the total volume sold.
The platform commission is then used to cover:
Player Bonus Payments
- ENERGYBLOCKS Player Rank Bonuses
- Player EB+ Bonuses
ENERGYBLOCKS Company Costs
- Employee Salaries
- Game Development Costs
- Marketing & Promotion Budget
- Blockchain Fees
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