Explaining Tabi Tokenomics And Our Unique Node Sale Strategy

The year 2024 is largely recognized as part of the bull run in this cycle, however, there have been no new structural narratives in the market, apart from the rise of meme coins. This is largely due to a lack of market innovation, with repeated narratives, repeated “games” played, and even repeated players in the market.

Recently, many degen friends have started paying attention to Tabi’s tokenomics, and there’ve been countless questions in the community about Tabi too. I feel it is necessary to share our complete thought process and rationale of what we are trying to achieve and why we are doing it.

I hope this article can help to quickly answer the community’s questions while also explaining the logic and design behind our upcoming node sale structure, and why it’s different from others too.

Tabi Economics Inspired by Curve’s Mechanism

Curve revolutionized the stablecoin market with its bribery mechanism, balancing supply and demand. Projects incentivize users to vote, who then assess the project or protocol’s reliability, APY, and risks.

Application in Game Publishing (and beyond)

Currently, chains and apps have siloed relationships. Collaborations and partnerships on gaming chains are business-driven without economic incentives. Grants are often subjectively allocated, influenced by factors like:

• Relationships: Personal connections between founders and BDs.
• Preferences: BDs favoring specific game types.
• Scheduling: Overlapping projects within a short period.

The gaming industry is filled with success stories of community-driven games like Stardew Valley and Kenshi, proving that community choice is a crucial element to it.

Conclusion

Our model integrates economic incentives and community-driven decisions, ensuring a balanced and fair ecosystem.

How Are We Different?

In an unprecedented way, we are incorporating the essence of Curve Wars into Tabi, into a chain itself. Before a game launches, it must present itself and outline its community rewards. VeTabi holders would then vote on the different projects, balancing quality, rewards, and risks. Projects that rank higher will gain greater community support and VeTabi allocation rewards, similar to receiving a “Grant”. Importantly, this is decided collectively by the community, and not simply by the foundation.

Benefits

1. Aligning Chain and App Layers: Genuine support from the base layer to the application layer.
2. Cost Reduction and Efficiency: Reducing the need for large BD teams. Currently, chains have extensive BD teams, incurring high costs and inefficiencies.
3. Decentralized Decision-Making: The community decides who gets support, with all actions made on-chain, removing the need for direct team involvement.
4. Real User Engagement: Unlike web3 quest platforms that offer superficial traffic, this model brings genuine users to the projects.
5. High Moat from Super Flywheel Effect: Sustained and growing community engagement strengthens the ecosystem.

Additional Thoughts

Reflecting on Pinduoduo and Alibaba:

• PDD’s Strategy: Disrupt other e-commerce platforms by significantly lowering the entry barriers.
• Alibaba’s Model: Manages a vast number of SKUs (stock keeping unit) with efficiency through third-party merchants, which despite sacrificing some efficiency, offers a broad product range and maintains early-stage cost advantages.

By integrating these principles, Tabi aims to foster a more dynamic, fair, and engaging ecosystem.

How Pinduoduo Does It

PDD doesn’t start with a vast number of SKUs. They focus on 1,000 SKUs and make them extremely affordable. How? They employ thousands of people to optimize supply chains, directly connecting with manufacturers. PDD’s strategy concentrates all traffic on these 1,000 SKUs, making each product a high-volume item. Some partners even accept losses to collaborate with PDD due to the immense exposure they provide.

Our Approach

We aim to reduce costs, improve efficiency, and decentralize decision-making, truly embodying the principle of “from the people to the people.”

Reference Models

Dutch Auctions and PoW Pricing:

• Gala pioneered node sales, where early participants benefitted from lower costs, and later ones paid more, with the latter often losing money. Despite this outdated 2020 model, some projects still use it.

Market Fatigue

By 2024, numerous projects have followed this same model, indicating market irrationality. The real issue is market fatigue with these repetitive themes, not a lack of funds, that results in lackluster results.

Tabi’s Strategy

By integrating Curve’s mechanics, Tabi allows games to present their case and reward the community. VeTabi holders vote based on project quality, rewards, and assessment of risk. Top projects gain community support and VeTabi allocation, that is decided by the community, not purely by the foundation. This aligns incentives and fosters genuine user engagement, ensuring a robust and efficient ecosystem.

Tabi’s Unique Approach

Drawing from Dutch Auctions and PoW Models

Since 2013, I’ve been involved in BTC mining. With each new generation of mining rigs, the increased hash power would outperform older machines. If you didn’t upgrade, you’d be left behind. As a result, market demand often exceeds supply, leading people to pay above the official price to benefit from higher hash power and more BTC rewards. This demonstrates how market dynamics dictate supply and demand.

Tabi’s Model

Inspired by PoW mining, our model aligns more with economic principles. As opposed to only early buyers making huge profits whereas latecomers incur losses, our approach limits such obvious disparities. Today’s users are educated by market cycles, and this model is no longer viable. The traditional system exploits FOMO without providing substantial benefits.

Core Logic

• Early Users: Higher cost = More tokens
• Mid-term Users: Moderate cost = Moderate tokens
• Late Users: Lower cost = Fewer tokens

This system ensures balance and fair play, with no absolute losers.

Original Node Level System

Unlike Gala and Xai, which only differ in price but not in performance, our model distinguishes nodes by performance. Users are increasingly savvy; treating them as fools will only backfire. Our innovative approach leverages the super flywheel effect to create a high moat, promoting sustainable growth and efficiency.

Why Introduce Node Levels?

In models like Gala and Xai, early users benefit from low costs and huge advantages, leading to issues like users continuously mining and selling, which eventually drains motivation for new users to purchase tokens and have a stake in the community. Recently, we’ve seen many new node projects fail to address this. Who will buy the later nodes and why?

Tabi’s Solution

Tabi node sales are divided into five levels, each offering advantages over the previous. However, the key innovation is that Tabi nodes can be upgraded!

The Upgrade Mechanism

Users earn veTabi by running Tabi’s nodes, voting for rewards, and engaging in ecosystem projects, which boost their node level. This integrates users into the ecosystem, combining the chain and application layers.

Example: Gaming Workflow

1. To earn more veTabi (rewards), users play games to gain experience.
2. This upgrades their nodes, increasing hash power and earning potential.
3. Games gain users and revenue, attracting exchanges and more Web3 users.
4. The value of early veTabi voting rewards increases, drawing more users and projects, and creating a positive feedback loop.
5. This flywheel effect strengthens Tabi’s influence on game publishing.

Inspired by Canto

Currently, most Layer 1 chains exploit application layers, even though all Layer 1 revenue comes from ecosystem users who interact with the application layer. Tabi, inspired by Canto, shares gas revenue with application developers, creating more income sources (business revenue + community voting rewards + gas returns).

Symbiotic Relationship

Everyone knows that 80% of the revenue of most games comes from 20% of the players, and these players are the “whales” that every game wants. Tabi’s node design is essentially a higher-level reflection of this, with 200K node owner contributors or players.

Tabi encourages game developers to give various rewards to owners of different levels of nodes, according to their type of project. This is equivalent to turning Tabi’s early asset holders, that are part of the usual cold start problem, into a “whale” community of players for games. Thus, this builds a binding relationship between the game developers and their players that is sustainable in the long-run.

Aside from that, based on our tokenomics, we will be able to attract and guide developers on our ecosystem in the future, and protocols similar to Convex will slowly emerge. This also includes our own incubated project Mundus, which will be an important piece of gaming infrastructure on Tabi. Similar to Roblox, Mundus will serve as a middle layer that will empower users to rapidly develop their own mini-games on there, hence creating our own UGC developer community.

I’ve pondered the core moat of Layer 1. Is it speed, decentralization, or cost? There are different opinions, but our priority is developers. We have thought through and are offering greater commercial possibilities, a user-friendly PolyVM for Web2 developers, as well as a well-thought-out revenue structure and user path.

Tabi is prepared for future mass adoption.

Disclaimer：

1. This article is reprinted from [XAVIER LEE]. All copyrights belong to the original author [XAVIER LEE]. If there are objections to this reprint, please contact the Gate Learn team, and they will handle it promptly.
2. Liability Disclaimer: The views and opinions expressed in this article are solely those of the author and do not constitute any investment advice.
3. Translations of the article into other languages are done by the Gate Learn team. Unless mentioned, copying, distributing, or plagiarizing the translated articles is prohibited.