Many DeFi projects these days promote a ‘fair launch’ for token distribution. A lair launch allows all participants to join the offering under the same set of rules, with no early token sale to whales or VC’s or indeed predisposition towards any single user. A truly equitable token distribution.
It sounds good in principle but in practice many fair launch projects have run into trouble. In the absence of an ICO, private sale, or institutional investors for a crypto project, the degree of token dispersion can end up either too high or too low.
Tokens without fundamentals and too many uninformed participants
If too many users acquire the tokens in the public sale, it can result in tokens being too scattered. With these tokens being in the hands of retail investors, everyone would mimic a certain sell/buy action based on the market sentiment, resulting in extreme price fluctuations and unnecessary bear/bull market volatility.
Any news, positive or negative could cause the market to come crashing down or go zooming upward unsustainably without any real basis or fundamentals.
Not enough participants
If there are not enough participants for the public sale, it could become a playground for whales and people with more purchasing power to obtain a large number of tokens, undermining the whole point of a fair launch token sale. And unlike non-fair launch sales, whales can get a much higher concentration of tokens, which could be disastrous to both the project and the remaining retail users.
For example, trading in bull market scenarios involves large volumes and high frequencies, which tend to drive up the gas fees for transactions. This makes it extremely expensive for retail users to join in and compete against whales who use up their huge number of tokens mined/farmed, which generally have no lock-in periods.
SmartFi’s unique approach to the token sale
At SmartFi we approve of the Fair Launch principle and have worked to design a way to mitigate the issues experienced by other tokens, to find a robust but equitable path forward.
SmartFi’s tokens are designed for release in tranches, aligned with the success of the portal. This means that fresh tokens are made available for sale only when there is equivalent demand for loans on the platform. Besides this, several other interesting features make SmartFi’s token an attractive proposition.
- Equal opportunity:
SmartFi’s SMTF tokens are available to everyone who wishes to acquire them. This provides an equal opportunity for both a retail investor and an institutional investor to buy tokens at the same time, without either of them having an unfair advantage.
- Tradeable from Day 1:
The SMTF tokens acquired through the sale are tradeable from the moment they are purchased. As there is no lock-up period for these tokens, it enables the users to liquidate their investments any time they deem fit.
- Buy back guarantee for the purchased tokens:
If the users are not happy with the tokens, one year after they have acquired it from the SmartCycle; SmartFi will buy back the tokens back from the users for the initial price paid. No other cryptocurrency project or platform offers this kind of buy back guarantee, which is inline with SmartFi’s safety first policy.
- Additional hedge through a stablecoin:
If at any point, the users are unhappy holding SMTF or they feel that volatility could affect the price of the speculatory token, they can convert their tokens into SFUSD, an in-house stablecoin that is completely free to use, without any transaction fees incurred on the network. This is perhaps the best hedge available for any kind of cryptocurrency investment to date.
With such an array of benefits and a guarantee that your investments are safe, you wouldn’t want to miss out on the token sale. To participate in the sale event, you will need a SmartFi account. If you do not have an account already, click here to quickly set one up. Once you have an account on the SmartPortal, you can take part in the SMTF token sale by loading funds into your SmartWallet.
