Lition increases lockup period for all locked tokens

We are excited to announce that we have overworked vesting schedules throughout all locked token categories in order to create a more balanced approach for token dilution in the future. Our old lockup schedules resulted in heavily strong unlocking cliffs which we think is sub-optimal to foster a healthy token ecosystem. Therefore, Lition approached each and every investor and advisor in order to re-negotiate the terms so that each party agrees on an extended lockup with a softer vesting scheme. We are very glad that as outcome not a single investor or advisor opposed the new scheme, and we got a lot of positive support. Additionally, it would only be fair however if Lition itself adjusts to these new lockup terms with its ecosystem and team tokens which is why new terms have been applied to those as well.

“Over and over we’ve received cricticism from prospective and current investors for our massive token unlocks due in the upcoming months. That’s understandable, and I believe we now have a convincing answer: While Lition circulating supply would have increased by approx. 21m LIT (+80% circulating supply) in July, the new lockups lead to approx. 2m new LIT being unlocked (+8% circulating supply).” — Dr. Richard Lohwasser, CEO

New Lockup Terms for Investors and Advisors:

The outcome is that seed/private investors and advisors receive tokens according to the new lockup structure which states the following over 10 months: 5% in July, 5% in August, 7.5% in September, 7.5% in October, 10% in November, 10% in December, 12.5% in January, 12.5% in February, 15% in March and the remaining 15% in April. In contrast, the old lockup schedule would have led to a release over 4 months with 25% each month, starting from July 17. For the new structure however, we have taken intentionally softer unlock cliffs so that the impact of fresh tokens is not as strongly concentrated anymore as it was before.

Lockup for Ecosystem, Community and Team

Ecosystem and team tokens have accordingly also been aligned with a new lockup structure. Ecosystem tokens for example are now being unlocked every 90 days with 12.5% starting from October instead of already July.

In addition to that, team tokens are vested over 4 years now instead of 2 years initially with the first unlock of 25% happening in April 2020. We as a team are confident in the sustainability of this project and are therefore willing to commit even harder by doubling our lockups from 2 to 4 years.

You can also find a comprehensive overview of the changes here:

Total Lition circulating supply vesting breakdown per lockup category (old vs. new lockups)

Resulting Circulating Supply

Due to the new token lockup structure, the circulating supply is being kept at much lower rates than with the original lockup structure. The following illustration visualizes how the new structure affects the circulating supply in comparison to the old lockup structure.

Lition Circulating Supply of LIT token over time

To receive an even more extensive overview, here the breakdown for what is going to happen in the next 6 months due to the new lockup terms:

  • July: dilution of 2.2m LIT (+8%) instead of prior 21.4 million LIT tokens (+80%)
  • August: dilution of 2.2m LIT instead of prior 11.1 million LIT tokens
  • September: dilution of 3.3m LIT instead of prior 11.1 million LIT tokens
  • October: dilution of 11m LIT instead of prior 24.5 million LIT tokens
  • November: dilution of 4.4m LIT instead of prior 0 million LIT tokens
  • December: dilution of 4.4m LIT instead of prior 0 million LIT tokens

We at Lition favour a steady small dilution over a radically strong increase in token supply and did therefore re-design the lockup structure to be gradually increasing instead of having few hard unlock cliffs. The community has raised its concerns regarding this topic as well and we hope to have found a proper solution to balance the interest of all parties involved.

Outlook

By having tackled the issues of strong unlocking cliffs, our focus for the future lays heavily onto our upcoming mainnet launch and the according availability of the staking functionality. Moreover, it is planned for the near future of the Lition protocol to support more Blockchains with our sidechain solution than just Ethereum such as it was announced already for Tomochain. Simultaneously to that, we plan to expand the LIT token amongst more reputable exchanges so that liquidity is being improved continuously.