Mantra Tokenomics Upgrade

TLDR;

- Max supply will be increased from 888M to 1.77B $OM.
- Fixed inflation rate of 8% during the first year.
- 49.5% of the new total supply is circulating at TGE.
- 50M $OM GenDrop to various supportive communities.
- Long cliff & vesting schedules for team & investors to align incentives.
- No staking rewards for locked team tokens.
- VC staking rewards are subject to the same vesting schedule as their principal investment.

Getting ready for Mainnet

Leading up to the Mantra Mainnet launch, the team has proposed an update to the $OM tokenomics with the primary goal to create lasting value for the future of the protocol, focusing on sustainable growth rather than short-term spikes.

This commitment reflects both the team & community's long-term vision for Mantra and the $OM token, aiming to position Mantra as the primary ledger of record for real world asset (RWA) tokenization.

$OM Token Allocation

The new proposed $OM tokenomics are about to increase the total supply from 888M $OM to 1.77B $OM. That is more than a doubling of the current max supply.

However, these newly issued tokens are all subject to a vesting schedule, hence they will not immediately be released on the market, but rather gradually over the next four years.

Team & Core Contributors

The longest cliff and vesting schedule is dedicated to the team and core contributors bucket, signaling commitment to long-term thinking and building.

To establish robust network security, these tokens will be staked. However, staking rewards will NOT be distributed!

Staking rewards accruing to team members & core contributors will either a) be burned or b) distributed to the community, through a future governance vote.

As the network achieves organic network security growth, these tokens will be gradually unstaked.

Pre-Seed and Seed Round

The second longest vesting period is reserved for early investors who participated in the Pre-Seed and Seed Rounds.

Investors' tokens will be staked and all accrued rewards are subject to the same vesting schedule as their principal investment.

One curious point to highlight here is that Pre-Seed tokens have a longer vesting time than Seed investor tokens, despite them having invested way earlier than seed investors.

Ecosystem Fund

The Ecosystem fund (37.7 million OM) is intentionally kept small and will be 100% unlocked at TGE to:

- support $OM liquidity provision
- for builder & community incentives

As the ecosystem matures, more tokens will become available through inflation.

Mantra Airdrop "GenDrop"

The Mantra GenDrop will distribute 50 million $OM to various communities that have engaged with Mantra leading up to mainnet. Eligible communities can be found in the below graphic.

- The airdrop will be locked for 3 months after mainnet.
- 20% will be liquid after the 3 months cliff.
- 80% vested for 9 months.

The 3 month airdrop cliff is designed to encourage users to engage with Mantra mainnet while also allowing them to earn or increase their GedDrop allocation.

More KARMA can be earned via onchain quests during this period.

$OM Inflation

Fixed inflation rate of 8% during the first year.

- 60% of it (or 4.8%) will be allocated for staking rewards.
- 40% (or 3.2%) will be directed to the MANTRA Chain Association (ecosystem fund) to support future initiatives.

MCA inflation will contribute towards:

- liquidity incentives to boost TVL.
- development of public goods.
- support for RWA dApps.

Special Surprise

As a token of gratitude, loyal $OM stakers will be rewarded with an airdrop boost.

Their maximum allocation will move from 35% to 130%.

- Less than 100K OM staked => 18 months vest.
- More than 100K OM staked => 36 months vest.

Any unallocated portion of the OM Upgrade bucket will subsequently vest into the ecosystem fund following the same 36 months vesting schedule, to provide ongoing support for ecosystem development and future initiatives.

Emission Schedule

- At Mainnet over 90% of the legacy OM will already be in circulation.

- Adding the liquid 37.7M from the ecosystem fund, the initial circulating supply will be 49.5% of the new total supply at TGE.

- Despite the new tokenomics, $OM maintains a high float.

For more in depth details check out the full proposal on Mantra chain.

Thanks for reading folks, we hope you've found this article helpful.

Disclaimer

This article is intended to educate readers about certain topics and should not be considered financial advice in any way.