The Verasity tokenomics community consultation is now closed. Running from August 4th to the 29th of September, the consultation was one of the biggest of its kind in blockchain — open to over 500,000 VRA holders and community members, with thousands of responses.
Firstly, we would like to thank everyone who participated in the consultation, and for the detailed suggestions given. In addition to the multiple choice selections, we had hundreds of unique responses from both new and veteran token holders, which have not only helped shape the decisions we will share below, but also given us an important insight into what matters to you, the Verasian community.
We firmly believe that this update directly addresses the concerns raised in the consultation and represents the vast majority of VRA token holders wishes. So, without further ado, let’s discover how Verasity’s tokenomics will change according to your valued feedback.
Warchest Tokens
It was clear from our consultation that our corporate Warchest tokens, 10 billion VRA in total, represented a significant ‘overhang’ to our tokenomics, with many token holders wondering if and when these tokens would enter circulation. These tokens did not enter circulation, however it was still clearly a cause for concern to our token holders, and your feedback overwhelmingly reflected this. As a result, the Warchest has now been burnt in its entirety. The transaction address for the token burn can be viewed here.
We are now able to do this for the following key reasons:
- VeraViews has reached a revenue stage — The Warchest was minted around the same time that VeraViews first made its commercial debut. While the Warchest was originally minted for potential acquisitions and strategic growth, it has since become clear that VeraViews has a proven path to commercial adoption, and the Warchest is no longer required.
- Video player agnosticism — The Verasity product team have worked hard to deliver a solution that enables VeraViews to be deployed across a large number of video players, making it less likely that we need to acquire a video player or publisher to strengthen our commercial offering.
As many of you will recall, the Warchest was originally reserved for strategic acquisitions — i.e. if Verasity decided to purchase another company or technology stack to improve our offering. With the successful commercial rollout of VeraViews, and the onboarding of new clients, this is no longer necessary. Future acquisitions, if needed, could be funded by revenue.
We expect this will be a very welcome change for our community. It effectively caps our circulating supply at just over 10 billion VRA tokens, which is subject to further deflation following our quarterly burns — with over 155 million tokens burnt to date. It also provides assurances that the Verasity team did not utilise the Warchest, as some members of our community speculated. With the burning of the Warchest, VRA’s theoretical maximum supply is cut by 50%.
Proof of View Marker Tokens
There are 90 billion Proof of View (PoV) Marker Tokens issued on the same contract as circulating VRA. These tokens do not contribute to circulating supply, and exist only for data transfer purposes to power the VeraViews ad stack.
It has been shown that these tokens have never made their way into circulation, and do not impact the VRA in circulating supply. However, following our consultation we recognise that PoV Marker Tokens do exert the following pressures on our tokenomics:
- New Investor Confidence — PoV Marker Tokens appear on the same contract as circulating VRA, and are therefore included in the ‘total supply’ figures given by CoinMarketCap and CoinGecko. Newcomers to our ecosystem assume, at first glance, that these tokens could enter circulation, with many leaving our ecosystem before learning the true function of PoV Marker Tokens.
- Mint & Burn Functionality — PoV Marker Tokens are minted and burned at regular intervals as data is circulated through our advertising stack. However, many newcomers to our ecosystem mistakenly take PoV Marker Token mints as newly minted circulated supply, and PoV Marker Token burns are often confused with our quarterly burns.
As a result, and with the help of your feedback, the Verasity team has concluded that VRA may benefit from PoV Marker Tokens being moved to a wholly separate blockchain.
We are actively exploring this implementation, although the technical effort required to do this is significantly larger than the burning of the Warchest, which we have already acted on. This is because, unlike the Warchest which was not utilised at any time, PoV Marker Tokens are being actively used to power live campaigns and move data to the VeraChain — as can be seen by exploring our on-chain data. These campaigns have already been funded by our publishing partners and we must minimise disruption to any live operations.
That said, we believe the greatest opportunity may lie in utilising a different blockchain ecosystem to separate PoV tokens from circulating VRA tokens. However, as this could represent a large disruption to our current operations and to token holders, we will once again open this process to our community for consultation — with the renewed trust that we will act on your feedback, given our burn of the Warchest in its entirety following our community’s wishes.
We will soon invite our community and representatives of blockchain layer-1 solutions to consult on which ecosystem they feel is most likely to deliver a blockchain for PoV tokens that 1) addresses the needs of our commercial partners and, 2) reflects the best utility and ease of use for our token holders. Naturally, in tandem, the Verasity product and development team is actively exploring and testing new chains and infrastructure to this end already, with a focus on commercial readiness.
Why do we want to open this process to the community? Your feedback is highly valued in this regard because the social network effect and community perception of any new blockchain infrastructure we explore is also a very important factor for our success.
Given that this process has begun, let’s explore our criteria below for a new blockchain for PoV tokens.
Our Criteria for a New PoV Chain
As shared above, PoV and VeraViews are live solutions which require careful planning to redesign without affecting our commercial operations.
Therefore, we have outlined the criteria that any new chain we explore must fit. These include:
1) Metadata Functionality — Metadata is additional information or data associated with blockchain transactions, blocks, or smart contracts that provides context and supplementary details about the content and functionality of a transaction. To store data on-chain, we require the ability to efficiently store metadata whilst keeping blockchain transactions sustainably small,
2) Transaction Speed — We require a very high transaction throughput in order to enable frequent writes (given the size of data sets from advertising campaigns), and also to provide capacity for further scaling without the necessity of keeping many separate nodes running,
3) Scalability and Interoperability — We require a scalable and efficient tech stack used, ideally written in C/C++, Rust, or Golang, which will enable us to easily build out our solution and easily make our tech stack available to partners,
4) Open Source Code — Open source code refers to computer software whose source code is made freely available for anyone to view, use, modify, and distribute. We require open source infrastructure to build and improve on our solutions. We are not expecting an out of the box solution, and we are ready to modify the selected blockchain to our needs.
Ideally, any blockchain solution we choose should also provide:
1) A full node client software availability, ideally in the form of a software development kit (SDK) written in a few popular languages,
2) A convenient blockchain explorer solution that can be adjusted to our needs (to easily enable our partners to view data on-chain),
3) Low overheads — as most of the blockchain solutions are designed for token transactions they have a built in fees mechanism, which is not required for the application of PoV.
As you can see, we are undertaking serious evaluation of solutions which will enable us to separate 90bn PoV tokens to a new blockchain.
We believe that the majority of our community will understand and welcome this second round of proposals, given that we have listened-to and immediately acted upon your feedback concerning the Warchest tokens, and considering the complexity of changing PoV Marker Token infrastructure while our product is live and in real-world use. Please keep an eye out for the final PoV Marker Token proposal round on our social media very soon.
The result — after our two rounds of consultation and subsequent action, including the Warchest burn and new choice of chain for PoV Marker Tokens — will be one of the most robust, community-led tokenomics ecosystems in crypto, and a huge milestone in Verasity’s history. We also hope to provide a blueprint for how crypto teams can work proactively with their community to establish long-lasting and sustainable tokenomics.
So, What’s Next?
As discussed above, these changes to VRA’s tokenomics represents one of the largest community-led success stories in the history of crypto. We took great care in collecting and acting upon your feedback, and now we ask you for one final push to help steer the future of VRA.
VRA from the circulating supply retains its utility as the primary payment option for funding advertising campaigns within the VeraViews ad stack. Likewise, if clients choose to pay in fiat, Verasity will use this to purchase VRA at market, and deposit it into an escrow account for campaign funding. This utility is integral to VRA from the circulating supply and remains unchanged by the proposals here.
We have proven our commitment to community-led change by our immediate burning of the Warchest. We are now focusing our energy on moving PoV tokens in a manner that causes the least disruption to both our commercial operations (given that VeraViews is live with clients) and to our token holders.
VRA will effectively adopt a ~10bn total supply and burns which ensure this supply is deflationary. This, alongside the fact that VRA has real utility within our ecosystem, and through VeraViews in an environment that’s live with clients, makes Verasity a highly unique project.
Let’s move forward, together.
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