XIP #14: XBG On-Chain Launch

Summary

This XBorg Improvement Proposal (XIP) suggests an alternative to the current XBG launch plan: launching the XBG token on-chain instead of via a centralised exchange. This proposal highlights the pros and cons of both options from our perspective. Please note that launching on-chain initially wouldn’t rule out listing on a centralised exchange post-launch with more favourable terms.

Introduction

Leading gaming projects launched this year haven’t performed well, even with top exchanges such as Binance, Coinbase, or Bybit.

2024 Gaming Token Launches

The overall performance of recent token launches has been underwhelming in all sectors. We believe this can be attributed to several key factors:

• Altcoin Dispersion: Many projects have launched their token in the first half of this year and are competing for a limited pool of capital, as there hasn’t been a proportionate influx of new investors.
• Risk Appetite: Current market conditions show investors’ decreased appetite for risk, resulting in reduced altcoin investments. The OTHERS market cap, which represents the total market cap of crypto, excluding the top 10 against BTC, has been at its lowest since June 2023.
• High Foreseeable Inflation: Investors are wary of purchasing tokens with a low circulating supply due to future token unlocks that cause the token to be inflationary.
• SocialFi Farming and Airdrops: The mass distribution of tokens through large SocialFi farming campaigns and airdrops, usually dominated by bots, has increased initial token selling pressure for new launches, negatively affecting token prices.

These factors highlight recent token launches’ challenges and showcase the need for strategic adjustments to mitigate them.

Centralised Exchange Route

Successful crypto projects have typically launched on Tier 1 centralised exchanges. Here’s what that route would look like for XBorg.

Pros:

• Increased Awareness and Credibility: Listing on a prominent centralised exchange can boost a project’s visibility and credibility, attracting more interest from potential investors.
• Accessibility: Centralised exchanges offer a seamless, user-friendly experience, including customer support and integrated wallets.
• Advanced Trading: Centralised exchanges offer advanced trading tools, such as order book systems that allow for limit buy and sell orders, giving investors more trading options.

Cons:

• Listing, Marketing and Advisory Fees: Listing on a centralised exchange includes significant fees for the listing process and ongoing marketing efforts to maintain visibility on the platform. It would cost around $1–2M USDT and 2% of the XBG supply.
• Imposed Low Float: Centralised exchanges require a limited circulating supply to create scarcity, reducing liquidity and increasing price volatility.
• Market Makers: Centralised exchanges require market makers who control a substantial portion of the token supply and influence market dynamics. Our market maker would control 2% of the XBG supply.
• Delisting Risk: If a token cannot maintain a predetermined valuation or daily volume, it will be delisted from the centralised exchange, and all fees will be forfeited.
• Delayed Launch: Launching with our centralised exchange partner would mean we would be subject to a launch date of their choosing. This could cause further delays.

Although big centralised exchanges can bring volume, awareness and accessibility to new token launches, there are significant downside risks to launching with one.

On-Chain Route

Launching on-chain is not the typical launch strategy for larger projects. Here is what it would look like for XBorg.

Pros:

• Relaxed Float: We would launch with an initial float of 15%, a fully diluted valuation (FDV) of $150 million and a market capitalisation of $22.5 million, making the launch price $0.15.
• Flexible Timing: Launching on-chain would allow us to decide the launch date. The TGE date would be set to August 15th.
• Market Makers: We would not use market makers to ensure organic market dynamics and retain 2% of the XBG supply.
• Deep Liquidity: We would set up large liquidity pools across Ethereum, Solana and Arbitrum totalling $2.2M. Incentives will be provided for community members who add liquidity to XBG/SOL or XBG/USDC. This would decrease price volatility, absorbing sell pressure and ensure an attractive trading environment across multiple chains.
• Holder Incentives: We would launch the XBG reward program to funnel the value accrued from the XBorg ecosystem to XBG token stakers based on their activity and token and NFT holdings.
• First Mover: We would launch a marketing campaign positioning XBorg as the first big project to decide against the CEX route. We think this could capture significant mindshare and position XBorg as a thought leader.

Cons:

• Marketing Support: Unlike launching with a big centralised exchange, launching on-chain means forfeiting any marketing support from the exchange’s official accounts.
• Web3 UI: Decentralised exchanges require users to utilise non-custodial wallets, which can be complex for novice crypto users.

To Note:

• Launch Partners: We would list on Uniswap and Raydium to leverage decentralised liquidity and the SwissBorg app for accessibility.
• CEX Future Listing: If governance permits, we would explore listing the XBG token on centralised exchanges post-launch.
• Community Unlocks: At launch, 100% of community-raised tokens will be unlocked. This pertains to the KOL Round, Community Seed, and Presale only. Pre-seed investors will have a one-year daily vesting schedule. All other token schedules will remain unchanged.

Although the on-chain route lacks the awareness and credibility that large centralised exchanges offer, its flexible nature allows us to launch on our terms and allocate resources to community-based incentives.

Core Team Perspective

We believe launching on-chain, fully unlocking community-raised tokens, and listing on centralised exchanges post-TGE is the best option for XBorg. This will allow XBorg to pioneer a new token launch meta and ensure better price dynamics for the XBG token. The low float, high FDV meta is predatory and favours exchanges and market makers at the expense of the community. Additionally, we believe that a full community-raised token unlock on Day 1, instead of a long vesting schedule, favours organic price development with fewer marginal sellers.

Conclusion

Both options have advantages and disadvantages but impact essential items such as the launch date, XBorg’s treasury, and XBG token emission. Thus, we deem this proposal the most important XIP to date and ask you to consider your decision thoroughly.

Frequently Asked Questions

• Why use an XBG-weighted vote mechanism?

The XBG token is the core pillar of XBorg’s decentralised governance system, supplemented by the Prometheus NFT. Thus, the voting mechanics use XBG-weighted votes.

• Where can I learn more about the proposal?

1. You can listen to the recording of The Fireplace #40 where Louis, XBorg CEO, discussed the proposal with the community: https://x.com/i/spaces/1jMJgBNNyDqGL

• Why is my Presale token amount different from my voting power?

The token bonuses distributed to Presale participants for holding an XCode or a Prometheus Chestplate are not considered. Therefore, there is a slight difference between the number of tokens you are entitled to for participating in the Presale and the voting power displayed on the website.

• Will the XBorg core team participate?

No, the team will not participate in this vote. Only the XBG tokens purchased via the Presale and previous community funding rounds grant voting power (in addition to the Prometheus NFTs). Some team members hold Prometheus NFTs and invested in the Presale with their own funds, representing less than 1% of the total voting power.

• Can users who invested only via the SwissBorg app vote?

No, users who bought XBG through the SwissBorg app Alpha Vaults only cannot participate in this vote because we cannot verify the exact amount of XBG each user purchased on the SwissBorg app.

• Why can’t I see my Voting Power or vote?

You have most likely not connected the wallet you used to purchase your XBG tokens with or you haven’t selected the network that you bought them on, either the Ethereum or Polygon network.

• How can we ensure that the vote is fair?

You can track the wallets that participated in the various XBG sales and compare the data with the vote participants, which will also be made public.

Additionally, a log of votes will be made available.

• Community Seed Deposit Address
• Presale Deposit Address (Polygon)
• Presale Deposit Address (Ethereum)