A New Approach to Token Creation
As decentralized finance (DeFi) and blockchain technology continue to evolve, the methods for launching and supporting tokens must also advance to meet increasingly complex demands. Dymension’s upcoming 3D upgrade introduces a novel approach through Initial RollApp Offerings (IROs), a mechanism that allows for early trading of RollApp tokens, well before the launch of the RollApp itself. Unlike traditional token generation events, IROs provide a structured pathway to build an early ecosystem, establish liquidity, and create a committed community.
By allowing participants to engage with RollApp tokens during the creation phase, IROs bridge the gap between speculative trading and community-centered ecosystem building, aiming to address some of the fundamental challenges in token economics and network growth.
How IRO Tokens Work
In the TradFi, futures contracts are widely used to secure positions in anticipation of a future asset’s value. Dymension’s IRO tokens work similarly. As part of the RollApp creation process, project creators can opt to allocate a portion (or even the entirety) of their planned token supply to the IRO. These tokens act as placeholders or “futures” for the native RollApp tokens that will eventually be issued once the RollApp officially launches.
Each IRO token is represented by an ERC contract, meaning it can be transferred, traded, and used across compatible DeFi platforms, just like any standard token. Upon the RollApp's launch, holders seamlessly exchange IRO tokens on a 1:1 basis for the native RollApp tokens, transitioning them from early supporters to active participants. This mechanism fosters an inclusive model for network growth, providing early adopters with an opportunity to be part of the ecosystem’s evolution from its inception.
Customizable Bonding Curves for Pricing
A key innovation within Dymension’s IROs is the customizable bonding curve, which determines token pricing based on demand and trading activity. In tokenomics, bonding curves have emerged as a sophisticated method for setting price as a function of token supply and demand, creating a continuous, algorithm-driven market. Dymension offers creators a selection of bonding curves to match the unique dynamics of their projects:
Fixed Price: The token price remains constant, a straightforward option for projects seeking a simple fundraising approach.
Linear Growth: The price increases at a steady rate as tokens are sold, offering a predictable rise in token value with increasing demand.
Logarithmic Growth: Starts with a rapid price increase that gradually stabilizes, ideal for projects expecting high initial interest followed by sustained engagement.
Exponential Growth: Accelerates token price as demand rises, generating scarcity and aligning incentives for early adopters.
This strategic flexibility allows RollApp creators to align the initial economic structure with project-specific goals, ensuring that the IRO phase serves not only as a fundraising tool but also as a carefully designed market entry strategy.
The RollApp Creation Process
The RollApp creation journey is transparent and accessible. Here’s how it unfolds:
Registration: Creators provide essential RollApp details — including tokenomics, social media links, and project domain — which are publicly recorded on-chain.
Token Allocation: A defined portion of tokens is reserved for the IRO. For projects aiming for a “Fair Launch” designation, 100% of tokens are allocated to the IRO, ensuring equal access for all participants.
IRO Launch: With the bonding curve set, the IRO begins, enabling early adopters to purchase tokens and support the RollApp.
Once the RollApp is ready to go live, IRO tokens are swapped for native RollApp tokens, allowing supporters to join the RollApp ecosystem as early holders and users.
Boosting Liquidity Through a Bootstrapping Event
Liquidity is crucial for the success of any token ecosystem, and IROs are designed with this in mind. As soon as the RollApp launches, users can burn their IRO tokens at a 1:1 rate to claim native RollApp tokens.
Simultaneously, the DYM raised from the IRO automatically seeds a liquidity pool for the RollApp token. This liquidity ensures that trading can begin immediately at launch, with the initial price set by the final traded price from the bonding curve. Any unsold IRO tokens are allocated as liquidity incentives, further reinforcing the RollApp’s economic foundation.
IROs - A Strategic Tool for RollApp Creators
IROs empower creators to cultivate a committed user base, establish liquidity from the start, and build a decentralized economy aligned with the project’s long-term vision. This holistic approach transforms the process of token generation from a one-off event into a comprehensive ecosystem-building exercise.
The Initial RollApp Offering model is now live for testing on Dymension’s Playground, with a full rollout on the Dymension Mainnet anticipated in the upcoming 3D upgrade.
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