Thread by @beniaminmincu

1/ Today is a big day for Utrust and Elrond.

It is the day we present a new economics model for UTK 2.0. One designed to reshape payments, putting Utrust, its community and merchants at the epicenter.

Time to enter the next level.

2/ First, let’s set the context.

Growth is the most powerful force for alignment.

With enough growth, everything -- literally everything -- falls into place.

Growth is the reason Elrond is joining forces with Utrust.

3/ There are two fundamental views on how one can achieve growth: zero sum vs. non zero sum.

One focuses on just taking away other people's pie.

The other focuses on unequivocally growing the pie to the largest extent possible.

4/ Suppose you could own 50% of a small pie of, say, 10 million, or 1% of a hyper large pie, of 10 billion, yielding wealth of several generations.

What would you choose?

5/ This is powerful and interesting.

In other words, to achieve unprecedented growth a shift in perspective is necessary.

But what does this new model bring specifically?

6/ Well, few things actually:

• powerful and new utility
• a potent value accrual mechanism
• a new economics model
• remarkable bootstrapping process
• a much wider distribution to a larger and hardcore community

7/ So what do these points mean in practice?

What is the core utility of the UTK 2.0 token?

The purpose of the UTK 2.0 token is to:
(a) incentivize accepting crypto, and paying w/ crypto

8/ (b) to capture value as more payments are made through the platform by combining a buy & burn mechanism for each transaction

(c) to align interest of all actors, users, merchants, etc. by transitioning to a DAO governed by token holders

9/ How will the token achieve this?

In short: cashback, staking and premium features for all.

10/ Let's take a closer look at the most important things.

First, to incentivize usage, both merchants and users will be eligible for cashback.

This is a surprisingly powerful forcing function for nudging and reinforcing the right behaviors.

11/ Stake some UTK and EGLD, and you can unlock even better cashback rates.

12/ Second, there's an important paradigm shift we're doubling focus on: merchant yield.

Instead of paying a fee for each crypto transaction, now you can generate yield to offset the fees, and tap into a new source of income.

13/ Different rates can be unlocked depending on how much $UTK and $EGLD you have staked.

14/ Third, we're introducing $UTK staking 2.0.

A strong program, reinforcing value accrual over a period of at least 5 years.

It will enable very appealing & dynamic rates with an ~15%-35% APR in Y1

With staking, you can get great rewards & unlock the coolest premium features.

15/ Fourth, a significantly upgraded economics model.

The main idea of an economics model should always be to define the most valuable actions & design the right incentives to reward them.

Once the tipping point is reached the economic flywheel starts taking off significantly.

16/ To grow you need more merchants accepting crypto payments, and more users making them.

To accelerate growth in adoption via merchant cashback and user cashback, you need tokens allocated.

17/ To reinforce growth in retention via staking and merchant yield, you need tokens allocated.

Thus, an upgraded economics model comes into existence. UTK 2.0.

18/ The basic idea is that the current model with 500M $UTK token supply & no incentives in place, will transform into a model with 1.4B tokens, to be reached over the next 5 years.

And with powerful adoption incentives in place.

19/ This puts Utrust on a very different growth trajectory.

One truly exciting for both merchants and users alike.

20/ But there are two other important things.

Fifth, a buy and burn mechanism, ensuring that for every transaction made, 0.5% of that value is used to buy UTK on the open market to be destroyed.

An additional 0.5% is used to buy UTK & deposit it in the community DAO treasury.

21/ Thus, although the economics model starts with an inflationary 1.4 billion supply, with enough adoption, growth, and token burning, the model will transition to deflationary, *burning all supply until only 250m $UTK remain*.

22/ Sixth, as things grow Utrust will likely migrate and experiment more with a DAO model.

Imagine a new payment system that is significantly more efficient, super effective in creating value for merchants and users.

23/ And that is also transparent and creative in giving the community a voice in strategic decisions, and new expansionary programs.

24/ Amazing!

Now, two important question are warranted:

1. What's next for the current $UTK holders?$UTK holders have been here with the community for a long time, and they're key to the next growth phase. So all $UTK holders can do a 1:1 swap to the new UTK 2.0 ecosystem.

25/ This is a unique chance to choose the future you want to play a role in, join forces with one of the strongest communities in the space, and bet strongly on the next steps.

26/ 2. Why is this big and relevant for the Elrond community?

A) $EGLD is the native reserve and fuels the internet-scale payment railways.
$MEX fuels the DeFi components of #web3payments.
$UTK fuels the buyer & merchant relationship of #web3payments.

27/ The larger the expansion during the next 5-10 years, the stronger the complementary relationship between these 3 verticals and tokens.

28/

B) There are two ways for the Elrond community to join and be part of Utrust:

The first one is obvious: get a share of tokens and start contributing.

Second, we are thrilled to have UTK 2.0 be one of the first projects to debut in the Metabonding program.

29/ Around 16% of the UTK 2.0 token supply will be distributed to the most valuable holders, builders and contributors in the Elrond ecosystem: EGLD stakers, and LKMEX stakers.

If you've been sitting on the sideline, now is the time to act, join, and contribute.

30/ This is all fascinating, but when will it all happen?

Gradually, over the next several months.

Starting with March, a new swap bridge will be deployed, metabonding will begin, and staking will commence.

Everything else will follow a well thought strategic rollout.

31/ I can imagine all this is tremendously exciting and perhaps even slightly overwhelming.

These ideas & plans have been developed over the last months.

It might be a lot to take in at first, but soon, you’ll realize it’s the future.

It's how we take things to the next level.

32/ To be sure, this is an important upgrade and improvement proposal.

And several other posts will follow with the strategic rollout plan, and relevant dates as they come closer.

Some ideas might still change as we discover new things.

33/Zooming out, there are 3 things to keep in mind:

1) Sharing this plan is a huge first step on an awesome journey we're setting together.There will be many challenges, but as many times in the past, one by one, we'll conquer all of them.

Pushing forward each day. Relentlessly

34/

2) @ElrondNetwork and @Utrust are one community now.

To the extent we can align forces, and stand together, we are unstoppable.

35/

3) We intend to enable a new type of payment, at internet scale. One that opens a closer tie between users and merchants all over the world.

36/ Global payments revenue is projected to reach $2.5 TRILLION USD by 2025. Perhaps the number will be even bigger.

Where will Utrust be in 3-5 years? How large will our market be? Will all this potential seem like a huge understatement in hindsight?

37/ Perhaps it will.

Perhaps most people cannot yet see how large this market will become.

Perhaps we're still very early.

It's all up to us to show how fast we can grow, how large the market can become, and how web3 payments can improve the world.

38/ In sum.

It's day one. We’re thrilled for the future. Together with @SanjaKon, @nunocor_, the @ElrondNetwork and @UTRUST teams, and our communities, we've got work to do.

39/ The seeds we plant today will undoubtedly bring surprising results in the years to come.

The challenge is on 👊
medium.com/utrust/introdu…