HEX tokenomics
HEX smart contract logic builds upon 'tokenomic' lessons learned from 12 years of crypto market successes and failures. Controversially designed to outperform Bitcoin, HEX has embedded innovative tokenomics in its smart contract code. These 'Pumpamentals,' as termed in HEX marketing, are programmed to reduce sell pressure, incentivize holding, delay inflationary effects, and allow new stakers to compete with older ones. There is even a design tokenomic to defer taxes.
Here are 6 of the key HEX tokenomics.
- Supply Security Tokenomic- This EVM feature is an often overlooked tokenomic, but it serves as a foundation for HEXs utility as a 'store of value'.
Succinctly put, this means that no inflation bugs are possible which for HEX holders means insurance against external inflation threats.
By being an immutable sub-account on EVM blockchains, HEX establishes distinct rules and an auditable token supply, detached from the consensus framework of the underlying ledger.
This separation provides immunity against inflation bugs that may occur on networks like Ethereum and Pulsechain. HEX users simply pay native gas fees to write changes from any of its 5 basic functions (send, receive, stake, unstake and Good Account) to the native chain when they want to commit changes to the HEX database. This means that the HEX supply remains walled off, following its own predefined, incorruptible inflation schedule.
So while faults in the consensus code of these other chains could theoretically induce inflation in their native assets, HEX holders can rest assured knowing their token balances are secured within the HEX isolated sub-account. It's a clever utilization of EVM architecture to safeguard against inflation risks.
Knowing where your supply comes from is a critical tokenomic for any store of value token. (No red beads please)
- Hodl Tokenomic- Reducing Sell Pressure.
To reduce sell pressure, the HEX smart contract ONLY permits stakers to mint inflation and additionally, the largest amount of inflation is given to those people that stake for 5555 days (the max length). Since stakers must burn their coins for the duration of their stake, this HEX staking logic effectively incentivizes people that hodl with the most HEX rewards. Additionally the inflation coins are only able to be minted upon stake completion...further deferring sell pressure. (There is an ability to unstake early and incur a penalty.)
HEX has the HODL tokenomic built into its stake/unstake logic.
- Compounding yield Tokenomic- Increasing Market Demand.
Compounding yield acts as the incentive to attract market demand. -The code in the HEX smart contract ensures that stakers earn more and more HEX as they stake longer and longer because the share pool they join when staking is designed to shrink over time...so any depositor/staker gets more of a reward over time.
The math of the smart contract approximates compounding yield for stakers and monetizes time. Base yield is 20% per year for up to 10 years. This rate is measured in the amount of HEX returned (not fiat). Additional yield comes in the form of penalty sharing from early or late unstakers.
Note that the yield is not just 20% fixed...but uses a clever sharepool inverse math to grow at a rate that is closer to compounding. Doing this math for unlimited stakers on a daily basis using solidity and limited CPU/memory is part of the magic of the HEX smart contracts share logic.
Compounding is the 8th wonder of the world.
- Stickiness Tokenomic- The Stick (Penalty for exiting)-
HEX smart contract uses the 'unstake' process to penalize early or late exits and to reward on time exits from the system. Exiting HEX before 50% of the stake time has elapsed results in portions of both the principal and reward HEX amounts being penalized. The penalties are similar to those used in Banking Certificate of Deposits. Day 2 early exit will penalize 100% of the principal...ramping down to 0% principal loss at 50% time served. Late Exits are penalized 2% a week so in ~50 weeks all funds are gone. Penalty code is called the 'Truth Engine' in HEX marketing.
Stakers must pay attention to HEX and honor to their commitments to get paid. Sticky.
- Longer Pays Better Tokenomic (Old stakers gotta go)- HEX is designed so that compounding yield is always within reach of new long term stakers. This is because ALL stakers are forced to end their stakes at a max of 5555 days. This means that although early long stakers are rewarded...new stakers can earn even more than earlier stakers if they stake longer.
Even for future stakers, Longer will always pay better.
- Good Accounting (TAX) Tokenomic- Upon stake completion, this HEX function allows people the flexibility to not mint principal or rewards but to instead defer this minting and store your value in the HEX ledger as Good Accounted HEX. -Some tax jurisdictions have threatened to tax unrealized gains on tokens. What if I've completed a stake, have large gains but I don't want to mint my 'coins' or their gains yet? HEX gives people this option.
Good Accounting is a beneficial feature added to HEX during the design phase. Since HEX stakes must eventually be removed from the share pool in order to allow the compounding effect from the share pool shrinkage to occur, this 'Good Accounting' public function was added to allow anyone to remove anyone else's stakes from the share pool after maturity without minting the coins. This can be done after rewards bleed out for example to clean up the share pool.
Any tax benefits are just a bonus to the design, but some people might find this an interesting way to have access to liquid un-minted funds without violating tax laws in their jurisdiction.
In summary, I think that the tokenomics contained in the 2956 lines of the HEX EVM smart contract are thought provoking, clever and innovative. With these forward-thinking tokenomics, I believe HEX is positioned for longevity in the cryptocurrency landscape. Show Less
