The team has emphasized that the token is purely a utility token used to:
1. Ensure a permissionless fashion of interaction with the protocols
2. Secure funds for further ecosystem development
3. Incentivize participation in potential governance of specific network functionalities
4. Stake for network security.
As for the token distribution itself, 1INCH will be distributed as follows:
- 30% for network security (4 year vesting)
- 22.5% for the 1inch core team and future employees (4 year vesting)
- 21% for ecosystem growth (yield farming, community building, research, etc.) (4 year vesting)
- 19.5% to investors and shareholders (2.5 year vesting)
- 5% to advisors with (4 year vesting)
- 2% to early Mooniswap liquidity providers (1 year vesting)
Upon the release of the distribution, the community was up and arms, stating that the team and investors had significantly more allocation than the community. 1nch refuted these claims, stating that the 21% to ecosystem incentives plus the 2% to early LP’s made up 23% to the community, the most of any pool in the distribution.
1INCH Liquidity Mining
For those who missed it, 1inch recently released an Automated Market Maker named Mooniswap. The goal of the exchange is to offer LP’s better returns by capturing the profit normally earned by arbitrageurs.
Now, Mooniswap Liquidity providers stand to earn a pro-rate claim of the total 2% of the 1inch tokens allotted to early-LPs subject to a 1-year vest. LPs will receive “vouchers” which represent a claim on future tokens, with their allocations unlocking in real-time over the course of the next year (similar to how CRV vesting works). Here’s a look at the pools being incentivized for the earlyLP period:
ETH-USDC, ETH-DAI, ETH-LINK, ETH-SRM, ETH-USDT, ETH-WBTC, ETH-AMPL, ETH-renBTC, ETH-sBTC, ETH-LEND, ETH-SNX, ETH-sUSD, ETH-YFI, ETH-CRV, ETH-GNO, ETH-MTA, ETH-REN, ETH-MKR, ETH-KNC, ETH-sETH, ETH-yCurve, ETH-AKRO, ETH-wNXM, USDT-USDC, USDC-wNXM, DAI-USDC, DAI-USDT, DAI-sUSD, DAI-yCurve, ETH-BZRX, AKRO-USDC, ETH-CHI, USDC-CHI.
Following the earlyLP period, 1inch will look to add extra incentives to specific pools, similar to how Balancer encourages “useful” liquidity with a variety of rewards factors.
With a layout similar to Uniswap, Mooniswap builds on accessibility alongside the main 1inch front-end. Mooniswap looks to counteract front-running and Impermanent loss which have been known issues in the AMM spaces since their inception. You can find the Mooniswap whitepaper here.
Just two days ago, Mooniswap reached a new high with $21M of liquidity. After the launch of liquidity mining, that number spiked to $51M and counting.
It's time to migrate from Uniswap V2 to @mooniswap since early liquidity farming was announced! You can do it with just a click by swapping from Uniswap pool token into the same Mooniswap one!#DeFi pic.twitter.com/pcIsUxqTZy— 1inch.exchange (@1inchExchange) August 22, 2020
Adding onto their repertoire is a native gas token, ChiToken (CHI). In just 1.5 years since inception, 1inch continues to be at the forefront of innovation for the growing DEX landscape.
Now, 1inch will look to maintain it’s market lead in light of contenders knocking at the door. If anything, the large backing from centralized players like Binance shows the project has strong financial support. However, the 1inch team should be aware that their decision to raise from centralized counterparts has put somewhat of a damper on this token launch.
Looking across CT it’s clear that many believe 1inch “sold out” with this token distribution and are quickly suggesting that 1inch is losing the grassroots ethos it was conceived with.
If nothing else, the 1inch token launch is sure to drive a vast amount of attention as the next major DeFi token to be released after Curve’s CRV and Balancer’s BAL – both of which have exceeded investors wildest expectations in recent weeks.
To stay up with 1inch, follow them on Twitter!
Tarang discovered ETH in 2018 and has been actively involved in DeFi after finding PoolTogether in 2019. He’s most interested in the DEX sector as a frequent user and participant in Uniswap and Kyber Network alongside lending protocols like Aave. Tarang’s active presence in DeFi has given him a front-row seat to cutting edge trends and real-time developments. Stay up with Tarang by following him on Twitter.