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Today, Sonic SVM, the first SVM chain extension on Solana, revealed a novel SONIC token value accrual mechanismĀ that significantly improves its tokenomics. In order to improve alignment with the larger Solana ecosystem and provide long-term value for token holders, the new design replaces the old burning model with a strategic buy-and-lock system.
50% of all transaction fees, which were previously burnt, will now be utilized to buy $SONIC tokens on the open market under the new mechanism. With a 24-month linear vesting schedule and a separate vault, these acquired tokens will be carefully managed to provide buy pressure and lower the amount in circulation.
Chris Zhu, CEO at Sonic SVM stated:
āThis redesigned mechanism represents a fundamental shift in how we think about long-term token value. Rather than simply burning tokens, weāre implementing a strategic approach that creates strategic demand while building protocol-owned liquidity. This supports our growing ecosystem of games and applications while rewarding our community of token holders.ā
Additionally, a new method for handling $SONIC feesāwhich account for 12.5% of all transaction feesāis introduced by the modified mechanism:
Both $SONIC and SOL holders gain from this arrangement, which gradually increases $SONIC liquidity while coordinating the tokenās expansion with the health of the Solana network.
The Sonic SVM ecosystemĀ benefits from the new mechanism in many ways:
Alan Zhu, co-founder and CPO of Sonic stated:
āAs we continue scaling our infrastructure to support millions of users across our gaming and social platforms, this value accrual mechanism ensures our token economy grows in tandem with network usage. The more the network is used, the stronger the buy pressure and deeper the liquidity becomes.ā
The Sonic SVM website has comprehensive documentation on the new technique, which will be put into use in the next weeks.
Creating a novel blockchain protocolĀ that functions as a programmable attention settlement layer, Sonic SVM is the first chain extension SVM to debut on Solana. It is based on the HSSN network and provides granular on-chain access to user activity across dApps, consensus-level validation of attention-related transactions, and composable primitives that remove the need for each project to create custom attention infrastructure.
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