📈How $VTN Accrues Value
The following details the two mechanisms designed for $VTN to capture long-term value: token burning and real income streams. As described in the Whitepaper, of the revenues generated through Vottun Ecosystem transactions, 70% is allocated to developer payments, while 10% is dedicated to token burning and another 10% to Real Yield. Finally, the remaining 10% goes to Vottun's treasury.
The Burn
10% of the revenues generated through user transactions on the Vottun Ecosystem will be used to purchase $VTN in the market and "destroy" it by sending it to a burning wallet. This action transforms $VTN into a purely deflationary asset (once the entire token supply is released).
On the other hand, since Vottun Ecosystem revenues are denominated in fiat, the lower the price of $VTN, the more tokens this fiat amount can purchase, and therefore, more tokens can be burned. This results in the unlikely event that $VTN has a low market capitalization at a specific moment; it will be offset by a massive token burn, inevitably driving up its price.
Real Yield
The Real Yield refers to a staking rewards model. Unlike traditional staking models where rewards come from additional token issuance, thereby diluting its value, with Real Yield, staking rewards are generated from a real income stream derived from a percentage of each transaction within the Vottun Ecosystem. Instead of relying solely on the creation of new tokens, it aims for a more sustainable model linked to the economic activity of the platform.
However, an initial allocation of 16% of the tokens is designated for staking and farming. This initial allocation serves two strategic purposes. Firstly, it allows for more attractive Annual Percentage Rates (APR) at the project's outset, thus incentivizing staking participation from the project's inception. Secondly, it provides a fund from which rewards can be drawn while the platform gains traction. The rationale behind this initial allocation lies in the need to generate significant incentives for stakers in the early stages. While the medium to long-term vision is to rely exclusively on revenues generated by Vottun Ecosystem transactions, this initial allocation serves as a boost for the early growth of the platform.
In conclusion, the Real Yield serves as a real income source derived from transactions occurring on the platform. On the other hand, token burning utilizes a portion of these revenues to buy tokens in the market and destroy them. Therefore, we have an asset that generates real income for its participants, while its circulating supply is reduced, making it deflationary—two of the most effective levers for an asset to acquire sustained value over time.
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