Refer to the “Education” section of Tokenomics DAO for the most up to date resources/articles on tokenomics.

Introductory Content

• All You Need to Know About Tokenomics

• Great starting point outlining the basics of tokenomics and overview of the key variables: supply, burning, monetary policy, token distribution and earnings

• An introduction to token economics (tokenomics)

• Similar level of detail to link above, but with a bit more detail on token distribution

• Tokenomics 101: The Basics of Evaluating Cryptocurrencies

• Breakdown of tokenomics through the lens of supply + demand as opposed to the underlying drivers (e.g. burning, monetary policy, etc.), with a high-level evaluation of Convex Finance

• Economics Design Youtube

• Lisa JY Tan’s channel on tokenomics. She’s also authored Economics and Math of Token Engineering and DeFi : Fundamentals of Token Economics

Sample Protocol Tokenomics Overviews

• Each example covers initial tokenomics, governing principles and the associated trade offs made when designing incentives compared to other protocols.
• NEAR Protocol
• Harmony One (Initial Token Economic Model, Updated Tokenomics, Economic Model)
• Florian’s substack
• Ethereum Tokenomics 2021: Impact of Eth2, EIP 1559, and L2 Scaling Solutions on Demand/Supply

• Slightly outdated, but helpful illustration of how changes infrastructure changes impact supply/demand dynamics for ETH (or another crypto asset)

Advanced Content

• https://ahitchhikers.substack.com/ - good deep dive substack on token engineering.
• Chapter 3: Cryptoeconomic Patterns - Value capture and distribution of protocols.

Tokenomics Evaluation Framework

Supply

Key Question: Based on supply alone, will this token hold or increase it’s value? Or will that value be inflated away?

• Total Supply

• How many tokens exist today?
• How many will ever exist? (eg is there a supply cap)

• Issuance rate

• Is the issuance rate fixed or variable?
• If variable, what are the factors that determine (and can influence) issuance rate?

• Allocation/Vesting

• How was supply initially allocated among investors, community, core team, etc? Are there any group(s) with a significant holding that could drive material selling pressure upon vesting?
• What is the vesting schedule for the largest holders?

Demand

Key Question: Why would someone hold this token?

• ROI

• Excluding any price appreciation, what is the return generated by simply holding the token? (eg staking)
• Is there an opportunity to earn additional return by yield farming?
• Are earnings/fees generated from the protocol distributed back to token holders?
• Does any “rebasing” take place as the protocol inflates?

• Rebasing works similar to a stock split, whereby holding and staking the token enables the holder to receive more, thereby offsetting any impact of inflation (eg % ownership remains constant)

• Community

• How active is their Discord/Twitter?
• Has an ecosystem fund been announced? Grants? Hackathons?
• How is the protocol actively working to drive additional community engagement?
• Do one-time + ongoing initiatives drive additional token demand?

• Lockups

• Is there a lockup program in place?
• If there is a lockup program in place, what is the incremental value of rewards and what are the requirements to earn those rewards?
• What % of total tokens outstanding are locked up?
• How much selling pressure is generated upon lockup expiration (and when)?
• Are there other non-monetary benefits to staking + locking up tokens? (eg increased voting power)

DAO Specific Content

• Incentive Design & Tooling for DAOs

• How to match a DAO's goals with the right incentive mechanisms to achieve them...