Tokenomics Part 2: Dual-token model
Pioneered by Axie Infinity, many newer GameFi have started to apply the dual-token model, that is, there are 2 tokens in the same game, one token will usually be used for administration, buying, and selling items, ... and one token is used as in-game rewards.
So how does this new model have a positive effect on the game and how has Widi Land applied this model?
Tokenomics is often tricky to deal with especially in GameFi due to the variety of roles that the token has to assume. To make the game attractive, players need to be rewarded with tokens with financial value, a cornerstone of this new generation of games, but this increases the inflation rate of the token and decreases its price. To balance the demand, tokens can be used to purchase items or characters in the marketplace or stake in-game. However, this tends to fall short of supply and prices hardly remain high enough to attract new players.
Therefore, Axie Infinity has come up with the dual-token model in which there are two tokens, AXS with a fixed supply and SLP with an unlimited supply. Specifically, SLP is a utility token with an unlimited supply that can be used by Axie Infinity players to perform in-game tasks like paying a breeding fee for their Axies (game characters) and purchasing Axies from the built-in marketplace.
On the other hand, AXS provides value to the Axie Infinity ecosystem where players can buy the token directly from crypto exchanges, and the holders of AXS tokens can take part in in-game governance and stake their tokens to gain passive rewards.
Another popular game that also implements the dual-token model is Star Atlas, a metaverse game built on the Solana blockchain, through its use of POLIS as a governance token and ATLAS as an in-game token.
No doubt that thanks to its benefits, many more games will follow suit and start to adopt this model.
Widi Land’s tokenomics
Similarly to Axie Infinity, we implement the use of two tokens.
WIDI Token (BEP-20 BSC token)
$WIDI Token is the business token of WidiLand with a hard cap of 400 million. It will be used as:
Purchasing lands and items at NFT Marketplace
Staking to earn interest.
$WSO Token (BEP-20 BSC token)
$WSO Token is the native currency in WidiLand. It is a secondary token with an unlimited supply that can be used in the WIDI Land ecosystem for specific purposes:
In-game and inflation token: mint-burn.
In-game activities: Upgrade items, Lotto Games, etc.
You can earn $WSO token as rewards for in-game activities:
You can see that this model accrues value to both tokens and prevents inflationary pressure to the main token $WIDI, which ensures that the interest in the game remains high. On the other hand, players can still enjoy financial rewards from $WSO.
The use of the dual-token model demonstrates the adaptability and resilience of the crypto industry when new games fix the weakness of the previous ones and thus are able to attract new players and money flowing into the market.
However, GameFi is still in the early stage as many barriers remain which alienates traditional gamers who desire enticing gameplay, great narrative, and stunning graphics. Moreover, the use of crypto wallets, gas fees, high upfront investment, … also makes GameFi mostly the domain of crypto enthusiasts, not the general public.
At Widi Land, with the aim of bringing players the most enjoyable experience, we continue to implement new innovations and improvements. The use of dual tokens is just the beginning and more is on the way!