LooksRare Announces Significant Token Economics Adjustment: What You Need to Know

By 0xGorki 09/30/23 2:56 PM

The LooksRare NFT trading platform has announced a formal adjustment to its token economics, a decision that has sent ripples of excitement throughout the cryptocurrency and blockchain communities. The change promises to not only reshape the dynamics of the platform but also have far-reaching implications for the future of decentralized finance (DeFi).

50% of Fees for LOOKS Repurchase

The headline feature of this strategic shift is the allocation of a substantial portion of platform fees for the repurchase of LOOKS tokens from the market. Previously, LooksRare has been using 50% of fees generated from new initiatives for this purpose, resulting in the acquisition of a staggering 1,800,000 LOOKS tokens for the platform’s Treasury.

Now, the ante is being upped even further. Under the new system, fees generated by these initiatives will be distributed as follows:

50% will be allocated to the repurchase of LOOKS tokens from the market.
10% will be designated as LooksRare Protocol Rewards.
40% will be funneled into the Treasury.

This strategic shift underscores LooksRare’s unwavering commitment to its protocol, extending beyond the initial LOOKS token emissions. Furthermore, this new model sets the stage for Protocol Rewards to continue accumulating fees over time, potentially from a variety of blockchain networks, hinting at exciting possibilities on the horizon.

Effective Date and Future Developments

The implementation of this groundbreaking adjustment is scheduled to commence on October 1st at 9:00 AM (UTC). The timing couldn’t be more intriguing, as LooksRare is doubling down on its foray into on-chain gaming, with several product offerings nearing completion. These forthcoming additions to the platform will also contribute to Protocol Rewards, promising even more opportunities for users.

Trading Rewards to be Discontinued

While this announcement brings a wave of anticipation, it also marks the end of Trading Rewards. The final Trading Rewards period will kick off on September 30th at 9:00 AM (UTC) and conclude on October 1st at 9:00 AM (UTC). The LOOKS tokens that were previously allocated for Trading Rewards will now be directed to the Treasury and utilized as incentives for future products and initiatives.

This shift stems from the recognition that while Trading Rewards have indeed been successful in generating Ethereum (ETH) for Protocol Rewards, they have simultaneously created substantial sell pressure. The new approach aims to optimize the allocation of LOOKS tokens, incentivizing both new and existing products for the benefit of the entire LooksRare ecosystem.

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