Token Economy

Design Rationale

The token economy is at the root of CUBE network's growth and the ecosystem's virtuous cycle. The underlying issues that form the basis of CUBE's token economy design are as follows.

Securing Critical Mass for Minimum Sustainable Economy(MSE)

Although decentralized applications promise to share more value with network participants, a core reason as to why they are difficult to popularize is because there is often a lack of effective strategies to secure critical mass adoption in the early stages.

The first challenge of CUBE's token economy is to provide a solution to how the network's inherent economic mechanisms can reach a state that can operate on its own; in other words, a state that constitutes the Minimum Sustainable Economy (MSE).

The CUBE network must be able to maintain and grow without additional external support when fees and additional revenues from the various services in the ecosystem are recirculated into a system reward pool and distributed as rewards for contributors who grow the network. In order to satisfy this condition, it is crucial to secure more than the critical mass size, and that the transaction value of the services used by these users must be large enough to continuously induce network growth.

Securing Resources for Bootstrapping Rewards

In order to reach MSE, it is necessary to acquire a large number of users, and the system must provide great compensation in the early stages in order to acquire them. And the Cube economy must provide an answer to where it’ll get the resources for these rewards.

$ITAMCUBE's Network Stake is the method to achieve the initial MSE of the CUBE network, and the Ecosystem Growth Fund will be used as a resource for compensation.

Mechanism for $ITAMCUBE Supply and Demand Stabilization

Controlling the supply and demand of $ITAMCUBE, the native coin of the entire CUBE ecosystem, helps to ensure that the entire ecosystem is stable and protects the market price of $ITAMCUBE. If there is a disbalance of the network’s growth rate and sync, causing an oversupply of $ITAMCUBE, or conversely, an undersupply, this may not only cause the problem of price volatility of $ITAMCUBE, but also may be a threat to the entire ecosystem as a whole.

Systematic supplements such as controllment of $ITAMCUBE supply and demand are needed to respond to sudden fluctuations in the level of qualitative burden on the system.

Balance of Cyclical Mechanisms that Maintain Motivation for Sustained Growth

Even after securing a minimum critical mass for maintaining the CUBE ecosystem, the rewards for network participants' contributions must be balanced so that the production of network value and its redistribution process can provide a lasting growth engine.

Control of $ITAMCUBE Monopolization

Compensation for $ITAMCUBE's long-term holders is based on the capital gains of $ITAMCUBE as the network grows. While these holdings may stabilize and increase the price of $ITAMCUBE, and in turn, contribute to the growth of the network, excessive rewards for passive long-term holdings may reduce other participants' motivation to make active contributions to the growth of the network. Mechanisms are needed to prevent excessive token ownership concentration, and rewards for active contributions to network growth should be increasingly greater than rewards for passive retention.