VEND Token: The key to our unique network
As we approach the launch of the VEND token, tens of thousands have signed up to participate and get their share as we begin to test our systems. For those who are new to Vendible and those who have followed us for years, we are providing this overview to get you ready for what is to come and why we think this digital asset, above all, will be the one you hold onto long-term as we give you ownership of our network.
What is the Vendible network?
The Vendible network is a trust layer for all blockchain networks. Through a process we call unique identification, or uID, we can verify that each Member of the network is unique without having to see or know any personal information of that Member. We have covered this process in other previous articles. Our uID accounts can help Members authenticate themselves on web3 and web2 applications while creating simple methods for cross-chain account management and protection against asset loss as your identity becomes your private keys.
Developers are working with Vendible to create new classes of web3 applications that can ensure bots do not attack systems, zero-knowledge checks to filter entrants, and custom data attributes. We want to make dApps fully web3, shifting dApps away from cloud storage services to our decentralized data model where users own the data.
Why is there a VEND token?
There are a lot of decisions that a web3 project should consider before deciding to create a token. In many instances, a token is not necessary if the services are not driven by a network effect or you do not wish to share control of a project. For Vendible, several factors influenced our decision to create the VEND token. These decision are outlined below.
Cooperation with accountability
Vendible is a cooperative network in which each participant is held accountable for their actions. In public blockchains today, this is not feasible given the pseudonymous nature of accounts; someone can create a new account or identity and move on without any connection to previous actions (beneficial or otherwise).
In the Vendible network, you are first proven unique (meaning there is no other instance of you in the network), and a main identity account on-chain becomes your anchor in web3. This main account holds no assets and performs no actions other than to create new fresh accounts that manage your data and assets. We call these associated accounts and they are critical to not only account management but privacy as well. Associated accounts have a zero-knowledge connection to the main account, ensuring that you can see your activity across multiple blockchains. On-chain, these connections are not visible. It also means that, even though no one can see any personal identification information about you in an associated account, they can still ask that account zero-knowledge proof questions and get answers as if it were the main account (without telling them what main account is yours).
This setup accomplishes two significant features. First, this ensures that all your accounts created through Vendible and existing private keys you import, are protected from loss. All accounts are recoverable through the main account, and the main account is recoverable through the uID process. You can always go back through uID and regain access to all data and assets stored in decentralized storage through your biometrics and specific information you add about yourself to your identity vault. No one else ever sees, stores, or holds your keys which means you are always in complete control — you have custody of your assets. Secondly, this allows us to create anonymous reputation systems where individuals and businesses can gain rewards for actions that benefit the network and lose stake for actions that harm the network or its Members.
The VEND token allows us to hold Members accountable without having to know or identify the Members. We use a stake and slash mechanism called Minimum Commit for this purpose.
The second reason Vendible has chosen to release the VEND token is strategic. We are entering an age where a tremendous amount of work and value are created solely through interaction across the internet. At the same time, the organization of communication and activity continues to improve. In this new internet age, a large, distributed base of support and effort can help us scale faster than our competition. For this reason, we have chosen to establish a participation mechanism for our token which awards assets to those who directly contribute to the platform’s success. This asset also opts them into a revenue share partnership so that support is circular, where participants help drive growth and revenue, and they receive a share of the generated revenue.
VEND token distribution
1,200,000,000 VEND (1.2 billion) will mint at token generation. This fixed supply means no additional VEND will be minted and no mechanism or plan to burn (remove from circulation) tokens.
Allocation of tokens
- Participation: 49% of VEND goes towards participation rewards. Rewards distribute as part of initiatives and contests announced by Vendible. Over time, Vendible will grant management of participation rewards to the members participating in governance.
- Vendible Labs: 21% of VEND goes to Vendible BVI Inc. This portion will go towards yearly employee incentives, partnerships, and forming or aligning with a governing body, the Foundation.
- DAO Foundation: 3% of VEND goes to the Foundation which will audit Vendible, assist with regulatory matters, and guide the network toward decentralization.
- Private Sale & Advisors: Vendible Labs committed 12% of VEND through a private Reg S offering for our seed funding. Another 12% has been designated but has yet to fully commit to our private funding round. Any portion of this allocation not fully committed before the TGE will return to Vendible Labs. Vendible Labs has 3% of VEND committed for advisory services to the company. These tokens are under strict 24-month vesting schedules.
Distribution of VEND
Dedicated accounts for private sale investors and advisors will manage their vesting schedules. At TGE, 5% seed round, 10% private round, and 0% advisor tokens will be available. Vendible Labs and the DAO Foundation are also on a strict vesting schedule that lasts ten years for the Foundation and forty years for Vendible Labs. As this is a long-term project, token distribution protects the participating Members and ensures sustainability. The sale of VEND tokens is optional for Vendible Labs or the DAO Foundation to operate as they have other revenue streams.
Vendible will administer no public sale of VEND. Decentralization of VEND will occur through participation rewards, locking VEND in associated accounts through minimum commitments, and exchanging VEND through DEXs and CEXs will achieve this goal. Members can earn VEND rewards by participating in the Trustible testnet program and our new ambassador program. Vendible Labs anticipates 2% of the participation pool distributed to Members each year. Vendible Labs or the DAO Foundation can add to this pool at any time with additional VEND brought in through revenue.
We should see slightly over 4% released at TGE, with a steady increase in supply during the first two years reaching approximately 25% in circulation. However, after year two, the supply emission reduces drastically as the token release is limited to participation rewards and Vendible Labs and DAO Foundation vesting. Further locking VEND into Ible City virtual land helps to manage rewards without accelerating inflation. Estimates for year 10 are currently at 35% of VEND in circulation.
Token dynamics and rewards
Each associated account created serves a specific purpose. These accounts help you connect to contacts, merchants, and, most importantly, applications. Applications can build custom authentication and management tools with our account structure while ensuring you own the data and assets with protection from loss. There is a small cost associated with the creation of each associated account. A percentage of that fee pulls VEND directly off an exchange to lock into the account while active. The VEND is returned to the account owner if the account becomes inactive or closed.
This minimum commitment becomes a measure of a Member’s activity on the network. If you only have a few contacts and applications you connect to, the amount of VEND locked is small. If you are a service provider or application developer, you will have a large amount of VEND locked away. In the future, the DAO can slash a Member’s commitment stake if they abuse the network. For those who support the network, a half-life releases minimum commitments after a lock-up period, returning VEND to the Member as a reward. Minimum commitments do not factor into staking rewards or governance.
Staking for revenue share (platform ownership)
Vendible Labs will provide open tools for developers to build entirely new classes of applications. Additional services for asset loss protection and account management position our network to help bridge the technical divide blocking web3 adoption for most people. Further, a portal to web3 will help bridge activity across major blockchains. All of these services generate revenue for Vendible Labs. This cross-chain revenue comes from assets such as BTC, ETH, MATIC, ALGO, USDC, etc. Since we have invited our Members to participate in the network’s success by building and supporting our vision, we, in turn, reward those Members by sharing this revenue directly with the network.
Vendible Labs (Vendible BVI Inc) is domiciled in the British Virgin Islands. As such, taxation laws are favorable for our revenue share model. Starting with the first quarter after the mainnet launch of Trustible, we will begin to reward stakers quarterly through a variable revenue share model. Beginning with quarter one, 76% of revenue generated through Vendible Labs services will go to Vendible Labs. The remaining 24% will be split between the staking pools described below. After the first active quarter, Vendible Labs will publish whether they were profitable with 76% revenue. If profitable, the next quarter’s revenue split will increase by 4% for the stakers. If it were not a profitable quarter, the split would decrease by 4%. Vendible Labs can claim a maximum revenue percentage of 100% and a minimum of 12%. After years of successful operation, the goal is to reduce the revenue to Vendible Labs (while remaining profitable) so that staking rewards have a higher yield than competitive products (other DeFi staking mechanisms). This goal motivates the Members to actively participate in advancing Vendible Labs products in the market while ensuring Vendible Labs remains agile and efficient.
Distribution of Member stake revenue
Revenue share comes into Vendible Labs as L1 assets such as BTC and ETH or stable digital assets such as USDC. The Member dashboard acts as a multi-currency wallet to manage inflow for those who stake VEND.
Current revenue share split for those staking VEND:
- 50% sent directly to Members’ wallets
- 30% to the DAO Foundation treasury
- 20% to Land Owners in the Ible virtual DAO ecosystem
Direct to Member reward example
Vendible Labs transfers revenue to pools with smart contracts governing distribution over a monthly half-life. As a simplistic example, revenue share distribution to stakers in Q1 is 100,000 USDC, 2,000,000 USDC for Q2, 300,000 for Q3, and 900,000 for Q4. Distribution pools emit half of their value each month. Having a half-life distribution helps ensure long-term commitment to staking even when markets are turbulent. A reflection of the example is shown in the table below:
The Vendible DAO holds 30% of the assets brought in through revenue share. These assets are used to fund the DAO’s operation and any partner organizations that may support the DAO. Members who stake actively participate in governance and have control over the assets in the DAO with the oversight of a governance board. These funds support initiatives or projects which nurture the DAO, Vendible Labs, or ecosystem focus items.
Ible City Land Owners
Ible City and the Ible virtual land ecosystem is a visual representation of the DAO and helps to manage its operation and governance. Ible City land owners are Members who have committed long-term to support Vendible Labs and the Vendible network. Owning land in the virtual ecosystem has many rewards, including 20% of the revenue share rewards converted into VEND tokens. With each distribution, 20% of the revenue share goes directly to exchanges to purchase VEND. This VEND goes to a pool for the landowners. The exact distribution to each landowner depends upon the number of plots they own and their location on the virtual map.
The DAO Foundation is a legal entity formed specifically to execute any directives made by the DAO Members. As such, a board of representatives will have to oversee daily operations. To ensure checks and balances, Vendible Labs will nominate short-term appointees to the board, the DAO Members will vote to decide whether each appointment gets a seat on the board, and the DAO Foundation audits Vendible Labs and their operations on behalf of the Members. This structure helps ensure that all participants are working for the benefit of the network. The DAO, with input from Vendible Labs, will be able to amend the revenue share model outlined in this article. Additionally, as future products, services, and revenue streams become available, these will relate to opening new land in the Ible virtual DAO ecosystem (sea, space, farm, etc.). Vendible Labs will work with the DAO to determine the best implementation strategy to ensure sustainable ecosystem growth.
Vendible Labs has intentionally crafted a token that rewards those who hold this asset without inflating the supply of that token. Participation rewards help ensure that we build a distributed team of supporters and builders that commit themselves to the success of this project long-term. We invite you to join our socials, learn more about our mission and vision, and help us become one of the leading projects in this new internet age.
Doug Broughton and Gwin Scott