After publishing our blog post on consumer tokens, we’ve received dozens of questions about what this means for GMT and GMT owners. The short version is nothing has changed, but read on to get more detailed answers to questions you may have. If you don’t see your question below, drop us a line at firstname.lastname@example.org.
Did you change GMT?
No! The features, functions and potential of GMT remain the same. GMT is a utility token. As described in our Whitepaper, GMT is for use in a consumer ecosystem. Users of GMT get consumer benefits (utility) through additional access in apps across the Mercury Protocol. We didn’t change GMT or switch its classification. Our blog post just discussed token types, including a subset of utility tokens called consumer tokens (sometimes called “App Tokens”). This is an important change to nomenclature, but not to substance. Our Whitepaper, website, Terms of Token Sale, past Q&A’s, and other public communications describe the ecosystem and lay out our same positions.
How do you justify the bait and switch?
There was no bait and switch. GMT has the same functionality as always, and remains in line with the descriptions set forth in our Whitepaper, Terms of Token Sale, website, past Q&A’s and other public communications.
Were you purposefully cryptic during your token sale? Why didn’t you more clearly state your intentions?
Can I trade GMT on a secondary exchange?
Per the Terms of Token Sale, GMT should never be traded on secondary markets or exchanges. GMT has always been for use in a consumer-developer ecosystem, not for speculative investment. Speculation in decentralized markets is not beneficial for creating the consumer friendly ecosystem we envisioned at the start of this project. While we can’t monitor all exchanges all the time, we’ve taken efforts to discourage secondary trading (including sending cease and desist letters), so that the ecosystem can continue to grow organically.
Are you going to give refunds to people who misunderstood your terms?
We have no current plans to issue refunds, but we are actively working on making GMT more usable and redeemable with various partnerships and in-house products. This aligns with the purpose of GMT as explained in our Whitepaper. Because it’s a competitive consumer marketplace, we can’t reveal everything we’re doing, but we’re confident that we’ve found satisfactory planned solutions for all parties involved.
Will there be a marketplace where tokens can be purchased or redeemed by consumers and developers?
The movement of GMT is central to the ecosystem, and we continue to develop the infrastructure to make that happen. We believe lessons from the broader marketplace can be applied to GMT. Healthy markets need safety and thickness to thrive, and congestion threatens the health of markets. We see this with Ethereum currently where transaction load is well beyond the market’s capacity. We have one shot to make our ecosystem work, and we believe speed-to-market is not necessarily an advantage in the current, early stage of decentralized apps.
How do you define “pegged” price? Why peg it?
By “peg” we simply mean that we don’t want the market price of GMT to fluctuate wildly, or else it becomes difficult for both consumers and business partners to efficiently use tokens in a developing marketplace. We priced GMT at approximately $.04 during the token sale and continue to price it at $.04. That price may change in future, just like any other product (i.e., an iPhone changes price year to year).
Would you consider pricing it against ETH or BTC or some other crypto?
No, because if GMT is priced and redeemed against a fluctuating value it can functionally be traded. As a consumer-focused product, we want to be priced against fiat, because that’s generally what consumers are used to working with. Plus, pegging against something like ETH ties us to that specific platform financially as well as technologically, creating systemic risk. In addition, we’re working to stay as blockchain agnostic as possible at this early stage of blockchain technical maturity.
How will you maintain a price peg? There are known ways of attempting a price peg in the cryptocurrency world, like creating an algorithmic central bank that adjusts supply based on demand, and a collateralized debt approach. Are you using one of these approaches, or something else?
Our approach to price stability is really simple: sell GMT at the same price it was sold at during the token sale until and unless we have reason to change the price as supported by GMT market data. In the future, GMT will be sold for fiat, as traditional consumers would expect. While we can’t stop people from trading GMT on decentralized exchanges, much like ticketing companies can’t stop scalping, we note that such trading is inconsistent with the Terms of Sale for GMT and, as we stated during the token sale, we will not support a secondary market for GMT.
Why are you so against decentralization? Isn’t that the whole point of crypto?
We are pro-decentralization. Our vision is to create a trustless way for consumers and apps to exchange value. We think the disagreement between our approach and some people’s viewpoint is HOW we get to a decentralized state. In our view, we’re basically creating a marketplace of digital service providers and digital service consumers, and that market needs to be bootstrapped and setup for success.
How are you going to deal with people who bought GMT in a secondary market?
We don’t have plans to marginalize or treat them differently. However, we will likely request they adopt our terms of service prior to participating in our marketplace and verify their identity and good-standing through a KYC/AML process. This is T.B.D. as our focus now is on developing software.
Do you have a plan for how you will keep things off exchanges given this is an ERC20 token and any DEX can add it?
As noted earlier, we actively discourage secondary trading and pursue issues privately when applicable — but we cannot police it everywhere, again much like ticket scalping. If it becomes a major threat to the development of Mercury Protocol, we will reconsider the actions required to protect the project. We chose to use an ERC20 token to encourage third party app development using GMT.
So what can we expect from you going forward? What’s the plan?
In the short term, we’re working to get the logistical backbone of our ecosystem set up, which includes things like gaining approval of using GMT in the app stores for all our partners, an easy to use token SDK, consumer friendly token management and redemption portals, and more. We expect to launch an alpha version of a portal by end of 2018 that will offer GMT purchases and redemption options pending regulatory approvals. Longer term, we’ll be building out the marketplace into a robust state and look to decentralize and/or open source various aspects of Mercury Protocol as it becomes stable at scale. Stay tuned for more and be sure sign up for our newsletter to stay up to date!