Launchpad (design)

Economics

Protocol revenue, what the native token is for, fee discounts and hook mining.

Where protocol revenue comes from#

Four activities pay the protocol, and all four are things that only happen when the system is being used for its purpose:

every launch
every paid hook
every marketplace module
every protocol transaction
              ↓
        PROTOCOL REVENUE
              ↓
     ┌────────┴────────┐
     ↓                 ↓
 BUYBACK $XXXX      TREASURY
     ↓
   BURN

There is no revenue from issuing the native token and no revenue from listing. Revenue is a consequence of volume, which is a consequence of tokens people actually trade.

What the native token is for#

A governance token with nothing to govern is a liability. The native token of this design earns demand structurally, from the way fees are charged:

This is borrowed openly from Hookr on Ethereum, whose documentation describes ETH pairs paying a 0.3% protocol fee that funds a bounded buyback-and-burn, while pairs quoted in its own token do not pay that fee. The mechanism is sound and the reasoning transfers: the native token is cheaper to build on, so people who build a lot hold it.

Hook mining#

This is the part that does not exist elsewhere, and the part most worth getting right. Every hook has its own volume, because every hook knows which tokens use it:

STOCK REWARD HOOK — this week

  tokens using it      37
  volume               $4.7M
  revenue              $31K

A share of that module's revenue goes to the hook's developer, and a share to people staking the native token. Usage becomes the thing being mined, instead of hashes or idle capital.

four ways in, one economy

  BUILD A HOOK  →  people use it        →  earn
  STAKE         →  the ecosystem is used →  earn
  LAUNCH        →  use hooks             →  a token that does something
  TRADE         →  generate activity     →  a market with published rules

Each participant needs the others. Hook developers need creators to adopt their modules. Creators need traders for the fees that make the hooks pay. Stakers need all three. Nobody earns from a system that is merely sitting there.