Archethic burns 90% of their native tokens

archetic burns tokens coins

Archethic became the first crypto project to burn 90% of the total supply of its native token ($UCO), 6 months after the launch of its Mainnet Beta. The decision was made after the network compared the token’s future supply with its current circulating supply. 

It was found out that there is a divergence from market standards that affects the trust of its investors. Thus, the project decided to pursue the adoption of the token economic deflationary model that will maintain the balance within inflation, deflation and equilibrium.

As per the Archethic CEO, Sebastien Dupont, their priority is to make the network sustainable without compromising trust. In fact, the network’s team claims that the blockchain can handle 1,000,000 transactions per second, the same mining power as Bitcoin but with 3.6 billion times less energy. 

To ensure the long-term sustainability of the network, the initial supply of 10 billion $UCO is now reduced to 1 billion $UCO. The remaining tokens are redistributed to the following:

  • Network funding: 38.2% of the token’s total supply was allocated to Network Funding which includes the circulating supply that will be used to fund the development of the blockchain in the future.
  • Adoption rewards: 23.6% of the token’s total supply was distributed as adoption rewards in the form of incentives for developers, grants for services and rewards for users. Adoption Rewards are helpful to attract users and developers to use the network.
  • Team and advisors: 14.5% of the token’s total supply was given to the Archethic’s team as their share. It will be vested after 60 months with added holding incentives.
  • Stacking rewards: 9% of the token’s supply will be distributed to those who stake their $UCO.
  • Exchange liquidity: 5.57% of the token’s supply is allotted on Centralized Exchanges (CEX) and Decentralized Exchanges (DEX) liquidity.
  • Dynamic miner reward: 3.34% of the token’s total supply is used for mining rewards.
  • Gamification and geo incentives:3.44% of the token’s total supply are used to reward nodes that are hooked on the network and are not actually part of the blockchain.
  • Foundation: 2.13% of the token’s total supply is allotted for the decentralized governance of the network.

Since $UCO now has a more limited supply, it became more deflationary by nature, just like Bitcoin. After burning 9 billion $UCO, the coin currently has an average annual inflation rate of 10.93% and that will remain steady until 2030. In 2080, when new tokens will no longer be minted, the inflation rate will be reduced to 0.5%, proving that the new token economics Archethic follows will make the network immune to inflation.  

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