Tokenomics plays a very important role in the life of the project, because tokenomics is a reflection of the economy in a decentralized world. The coin is the heart of the blockchain that continuously circulates and is responsible for many important project functions. Today we will analyze the Aleo tokenomics, and going forward, its necessary to mention that Aleo is an example of a relevant and proper tokenomics.
The Aleo tokenomics is designed to make it as easy as possible for all parties concerned in the system to agree in the behalf of the Aleo network.
Aleo tokenomics is based on the following points:
– The network’s token represents quite significant value
– The system encourages network participants to contribute to its security.
– Rewards do not contribute to unintentional, dishonest or malicious distribution
– Tokenomics encourages the development and use of an ecosystem of useful applications
– True decentralization, through Proof-of-Succinct Work consensus (you will find more info below)
Besides all these points, the Aleo team is open to your feedback and suggestions and preserves the right to make changes. Hopefully, all the changes will be for the best!
Aleo will have its own coin under the ticker ALEO. These coins are used to pay transaction fees (similar to bitcoin) and are expected to be the currency of choice for “verifiers” who will operate as L2 providers on top of the network.
The Aleo coin represents the cost of computing some fractional part of a zero-knowledge proof. Since mining in Proof-of-Succinct Work is proof-of-work, Aleo coins are a natural way for the market to value the worth of a zero-knowledge proof for an arbitrary program. Therefore, the price of this asset should show something about the overall demand for zero-knowledge computing, and this demand is likely to be high.
PoSW mining is a special case of an application within the larger Aleo programming model. The most significant difference between Aleo and other networks such as Ethereum is that fees on the Aleo network are calculated well in advance. Aleo does not have the concept of “gas”, which usually make any action extremely expensive as to run on Ethereum. In contrast, at Aleo everyone gets to know well in advance about the amount of coins required for transactions.
Now let’s have a look on how the coins will be distributed:
– 57% of all coins will belong to early investors, (funds that invested in the project in the early stages). The share is quite large, however, the coins will be distributed gradually that will not allow the funds to control the market.
– The team with a gradual unlock will have 20% of the coins, which is good.
– 15% of the coins will go to the ICO and will be sold
– 8% is planned to be distributed for grants (useful applications that will be in the Aleo network).
In the chart below you can see how the issue of coins will change over time.
Analyzing the graph, its not hard to see that the coins will be poured into the market gradually, this will provide the project which has a healthy economic component.
Unless there is no significant changes, the idea of tokenomics is really good and very promising. Let’s follow Aleo!