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- Backpack introduces unique tokenomics plan to protect retail investors.
- Pre-IPO tokens released gradually, tied to company growth milestones.
- Crypto exchange ensures long-term stability with milestone-based token release.
Backpack, a cryptocurrency exchange founded by former FTX employees, has introduced a groundbreaking tokenomics plan aimed at safeguarding retail investors. As per a recent announcement, the platform will issue its native utility token relative to the fulfillment of certain business milestones so that its expansion is directly linked to real-world economic behavior as opposed to a traditional token release strategy.
Backpack will release 25% of its total token supply in its token generation event (TGE) in this new strategy. The large share of such tokens, 240 million, will be airdropped to participants of the Backpack Points program, and 1 million tokens will be distributed among the owners of Mad Lads NFTs. Moreover, the exchange has come up with the separate tranches of pre and post IPO, with 37.5% of the entire 1 billion token volume allocated to each phase.
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The peculiarity of this method is that it pays attention to the token releases in a gradual milestone manner. The unlocking of the pre-IPO tokens will be done on a progressive basis with significant growth unlocks that will include regulatory approvals, product launches, and market expansions. Armani Ferrante, the CEO of Backpack, stated that each time Backpack enters new markets in the EU, Japan, and the U.S. or rolls out new products such as predictions, stocks, and cards, the token will be introduced in accordance with the physical developments of the company.
A New Era for Crypto Tokenomics: Protecting Retail Investors
This new strategy will protect the retail holders against probable dumping and over-dilution in the market. Backpack makes sure that the insiders will not gain at the expense of smaller investors by tying token unlocks to real progress. As Ferrante indicated, the prosperity of the team will be pegged on the overall success of the exchange. The founding team is entitled to hold a share in the company instead of getting an initial token allocation, and no financial benefits will be realized until such time as the company goes public or has an equity exit event.
Also, 37.5% of the total number of tokens will be deposited in the corporate treasury of the company at least a year after the IPO. Such a distribution is focused on the stability of the company in the long term and facilitating its further development.
Through this strategy, Backpack is part of a trend of crypto initiatives that are favoring the abandonment of conventional lockups in favor of a more growth-oriented token release strategy. Although the time of the TGE is not disclosed, the company has indicated that more details regarding the use of the token will be shared in the near future.
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