Disclaimer: 1inch network token is not yet released. Please, wait a couple of weeks for the official release announcement.
The 1INCH token is not an investment, it is an instrument that will help us build a decentralized permissionless network.
Update: The 1inch token is not for sale to users. It is a reward for using 1inch products. The tokenomics has not yet been disclosed. The sophisticated token architecture will create a virtuous circle in which users benefit from use. The system will be mark the most efficient and benevolent structure to ever hit the market.
1inch was founded just over a year ago by Anton and Sergej at ETHNewYork hackathon. Originally, the two white hat hackers were just looking for a solution for their own trading strategy. It was exhausting and inefficient to check for the best trading prices on all the DEXs — e.g. Uniswap, Kyber, 0x — before placing a trade. They — like all crypto users — needed an elegant algorithm to search every DEX for the best trading price and instantly deliver an optimized trade. The solution came with 1inch — a decentralized exchange aggregator that sources liquidity from various exchanges and is capable of splitting a single trade transaction across multiple DEXs, routing it through connector tokens.
At the end of July, 1inch reached $1B in total trading volume. Russ Hanneman, a character from HBO’s beloved Silicon Valley series, ordained the team’s entry to “Tres commas club” with a spicy congrats video. Whereas Russ Hanneman´s character “put radio on the Internet” — 1inch put DeFi on the moon.
Joking aside, 1inch recently released its own AMM protocol Mooniswap. This revolutionary AMM utilizes virtual balances to provide liquidity providers with more profit than any other AMM on the market. Shortly after that, another announcement made headlines — the successful closure of 1inch’s first investment round in which the project raised $2.8M from top institutional investors such as Binance Labs, Galaxy Digital, Dragonfly Capital, Greenfield One, Libertus Capital, FTX, IOSG, LaunchHUB Ventures, and many more.
1inch network token (1INCH)
Since inception, our focus at 1inch has been on decentralization and permissionless network operation. We have looked into several approaches and designs and have landed on one we are proud to share — the 1inch network token (1INCH).
The security provided by the token model is crucial for the successful further development of the DeFi money legos. More specifically the 1INCH token drives safe participation in the protocol and its future innovations.
1INCH token holders should be people that interface with the protocol in some way, are committed to its future development, maintain a sense of responsibility and belonging to the 1inch community.
How 1INCH captures value
The 1INCH token is a utility token that serves several network needs:
- to ensure a permissionless fashion of interaction with the protocols;
- to secure funds for further ecosystem development;
- to incentivize participation in potential governance of specific network functionalities;
- to stake for the network security.
The 1INCH token enables the open and permissionless system. Following protocol rules and contributing resources facilitates consensus between participants. The network has a low barrier to entry and encourages innovation. Moreover, the architecture of the network guarantees that no one will be excluded by the will of a single party.
Please note, that the use of 1inch.exchange and Mooniswap does not require a user to hold 1INCH token. The token provides additional incentives to utilise the service. All network statistics are open to the public.
A max vesting time of 1INCH distribution is four years. Over the course of this time, the distribution mechanism will be the following:
- 30% for security of the network and maintenance of its functionality with 4 year vesting;
- 22.5% for the 1inch core team and future employees with 4 year vesting;
- 21% for ecosystem growth (yield farming (see details below), community building, research, etc.) with 4 year vesting;
- 19.5% to investors and shareholders with 2,5 year vesting;
- 5% to advisors with 4 year vesting;
- 2% to early Mooniswap liquidity providers with 1 year vesting (see details below).
The initial (circulating) supply of 1INCH tokens (16%) will be allocated to security of the network, maintenance of its functionality, marketing, and community development.
Liquidity Mining on Mooniswap
As a recap, 1inch and Mooniswap protocols allow anybody to create next generation AMM pools or add liquidity to existing ones. These protocol users should practice with security while the protocol evolves. This is the reason 1inch proposed and implemented the concept of security via the 1inch network token (1INCH) — that is distributed among liquidity providers in the amount of 2% from the total supply of 1INCH.
For now, only following pools are incentivized from release date of Mooniswap by 1INCH:
ETH-USDC, ETH-DAI, ETH-LINK, ETH-SRM, ETH-USDT, ETH-WBTC, ETH-AMPL, ETH-renBTC, ETH-sBTC, ETH-LEND, ETH-SNX, ETH-sUSD, ETH-YFI, ETH-CRV, ETH-GNO, ETH-MTA, ETH-REN, ETH-MKR, ETH-KNC, ETH-sETH, ETH-yCurve, ETH-AKRO, ETH-wNXM, USDT-USDC, USDC-wNXM, DAI-USDC, DAI-USDT, DAI-sUSD, DAI-yCurve, ETH-BZRX, AKRO-USDC, ETH-CHI, USDC-CHI, ETH-DIA, ETH-STAKE, ETH-sEUR, ETH-SWRV, ETH-UNI, USDT-HUSD, USDC-HUSD.
1inch network tokens (1INCH) that are allocated to early liquidity providers to Mooniswap pools will be distributed via vouchers retrospectively. A voucher entitles a user to receive a 1INCH token through vesting (a gradual unlock every second). Each voucher will be sent to a liquidity provider’s Ethereum address with the portion of 1INCH tokens attached to it. The amount of 1INCH tokens on each voucher will be proportional to the period of time the liquidity has been provided for and the size of the contribution by a certain user:
A liquidity provider can exchange his/her unlocked voucher tokens on 1inch.exchange in the tab “swap” to any crypto asset he/she wills. Each voucher is valid for one year and a half only and has to be exchanged before the expiration date.
Yield farming with 1INCH token
In order to attract more liquidity providers to Mooniswap after the token release, we plan also to distribute 1INCH tokens without vesting to those participating in the protocol. Nowadays, the yield farming model is all the rage and suits our community’s needs. Specific pools with 1INCH token will be incentivized as soon as the token is launched. Details TBA later.
Update: Commitment to Community and Ecosystem
We want to clarify some of the confusion around the community’s share in the 1inch token distribution scheme. We noticed that some of you are under the false impression that the entire community is entitled to only 2%. That is incorrect. 21% is dedicated to Ecosystem Growth (that’s you) and 2 percent to early liquidity providers (also possibly you). In total: 23% to our beloved Community vs. 22.5% to 1inch team.
Ecosystem Growth refers to activities that distribute the 1inch token to the ecosystem i.e. community. The first example of this will be yield farming. We will incentivize you to yield farm with our 1inch token. We hope yield farming and future activities funded by the Ecosystem Growth token allocation bring real growth and benefit to our esteemed community. 23 percent > 22.5 percent because Community > Team 💖 .
The 1inch network token launch represents a large milestone for 1inch and decentralized finance. This launch demonstrates the technological maturity and financial stability of the 1inch project. 1INCH token augments and catalyzes the growth of this important ecosystem. You can expect more updates over the next several weeks.
Below you will find some useful links. Get involved with the discussion on our official communication channels:
Mooniswap Audit 1: https://dapp.org.uk/reports/mooniswap.html
Mooniswap Audit 2: https://mooniswap.exchange/docs/mooniswap-audit-report-2.pdf
Mooniswap Audit 3: https://mooniswap.exchange/docs/mooniswap-audit-report-3.pdf
Twitter 1inch: https://twitter.com/1inchExchange
Twitter Mooniswap: https://twitter.com/mooniswap
Telegram 1inch: https://t.me/OneInchExchange
Telegram Mooniswap: https://t.me/mooniswapchat