Backpack Makes Wave with “No Tokens for the Team” Strategy TGE

Cryptocurrency exchange Backpack, in preparation for its token generation event (TGE), has just unveiled a controversial strategy that prioritizes growth amid token unlocks. The strategy has made waves in the crypto community because it ensures there are no direct token allocations to team members.

According to a tweet by the exchange’s founder, Armani Ferrante, the TGE strategy prevents insiders from dumping on retail users. This also ensures that no founder, employee, or venture investor will receive wealth from the Backpack token until the exchange meets certain growth milestones. Ferrante calls this hitting “escape velocity.”

Backpack Unveils TGE Strategy

For Backpack, the ultimate goal is to hit escape velocity by launching an initial public offering (IPO) in the United States. Ferrante says the IPO may come quickly, slowly, or not at all. However, as the team works towards the event, the entire team’s token allocation will sit in the corporate treasury. According to Ferrante, this is the company’s balance sheet. The tokens will remain locked until at least 1 year after the IPO or any other equity exit event.

“It’s not until the company has access to the largest, most liquid capital markets in the world by going public–and it’s not until the company has done all the hard work to earn access to those markets–that the team can reap the rewards of the value created by the Backpack community from now until then,” the Backpack founder explained.

While Backpack aims for an IPO, all liquid tokens will go exclusively to users. Subsequent unlocks after the TGE will be triggered by key milestones such as regional expansions, stock offerings, and product launches. With this strategy, Backpack aims to ensure that the value of the growth generated by the new token unlocks exceeds the dilution caused by those token emissions.

25% Unlock at TGE

Meanwhile, details about Backpack’s tokenomics indicate that the token’s total supply will be 1 billion. The project will release 25% of the total supply at the TGE, totaling 250 million. The exchange will airdrop 240 million tokens to point holders and reserve 10 million tokens for Mad Lads NFT holders.

Approximately 37.5% of the supply will be growth-triggered unlocks to take place pre-IPO. The remaining 37.5% is the corporate treasury that will be unblocked one year post-IPO.

“With every growth lever we pull, tokens unlock in a predictable way to users, bringing in a new wave of token holders, growing the community, and allowing the product to soar to new heights,” Ferrante added.

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