Thread by @TheGemHunters

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Today we're kicking off a mini-series on tokenomics, vesting schedules & sale metrics as part of our #TGH series on how to successfully navigate through crypto and #DYOR

The focus for today is going to be on tokenomics, followeed by two more threads over the coming days -

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so stay tuned!

just by understanding those couple of points you can already easily distinguish, whats worth looking into and what's a straight pass. generally you can find that information either directly on the websites frontpage, or in the Litepaper / whitepaper.

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If you can't find it on either it's already a huge redflag.

as an example we are going to look at two of the recent #FitFi bangers - $GMT & $FITFI

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Lets start off with what actually are. tokenomics are covering a broad range from token usecase within the ecosystem, token mechanics, to token distribution.

@Stepnofficial has created a fascinating dual token system in which $GMT is the governance token and $GST the

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utility token. Both with different supplies, use cases and ways to obtain them.

you will come across many different use cases, of which most are going to be utility tokens. Some others will be so called governance tokens - and give you voting power and a chance to shape the

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future of the project. But there are also tokens which directly share the protocols / projects revenue with token holders.

No matter which usecase tho, at the end of the day it's of utmost importance, that the underlying project manages to increase adoption for its product.

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token mechanics are for example burn or reflection mechanisms, depending on the underlying smart contract of a token. Although you'll mostly find that kinda stuff on shitcoins, which use the reflection as a very cheap sort of incentive structure and the burn to create hype.

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Burns on transactions and buys/sell are often a sign, that shitcoin X lacks any product or proper plans for the future.
If you're mad that I took #BabyDogeCoin as an example here, then you should probably rethink your investment strategy 😉

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Checking token distribution can be done within seconds and you get great value for your time. What you want to be looking for is basically a project which doesn't allocates too much to the team and advisors. I'm generally looking for >15% for the team and > 5% for advisors.

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Also, I prefer when the difference between seed/presale and public allocations isn't too crazy. In the past we've seen sales with a difference of about 20/1 between this rounds, which actually is a red flag.

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When it comes to projects that can be deemed rather shitty you also want to make sure that the allocations for 'marketing', 'development', 'partners' and similar stuff aren't too high. The chance of them just being pocket money for the team is definitely something you

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Shouldn't ignore!

Ideally want to have a widespread distribution from day one and therefore many supporters. @TheDaoMaker approach for that is quite amazing and has shown great success with $FITFI, which had more than 5000 individual participants in the public #SHO

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Without any VCs involved (we covered why VCs can cause major issues in a previous thread).

The massive amount of $FITFi's long-term vested community is reflecting in their social activity. They've been pretty much trending since their launch and getting insane community

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engagement on posts.

If the thread has helped you please make sure to like and share the tweet. Follow us for the next episodes of the #DYOR series and more informative content + alpha in the future!