17. Token Economy Strategy & Risk Management

Practically, as it takes time to settle the token economy over fiat usage for commerce activities, DonaBlock supports two track transaction methods : fiat & token.

However as the ecosystem settles, the token model gradually expands so that the sustainable token economy can be created with enough market circulation. To gradually boost token transactions on DonaBlock, economy models to manage risks and to activate token usage are implemented.

Phase 1 : Early Stage to Test Basic Models

In the early stage of the Token Economy, the total volume of Fiat transaction will be much higher than that of Token transaction, but the circulation of tokens will be gradually increased through token inflow models by each participants (Suppliers, volunteers, Customers).

In this phase, compulsory controls on supplier side and on volunteers will create the base of token economy : suppliers must use tokens to activate product registrations to open any promotional deals with volunteers, and volunteers must be rewarded in token only for any sales activities.

Also, volunteers who aim higher Block-Fame index and to expedite the deals are encouraged to accumulate tokens.

The initial benefit from Customer Reward is high in actual market value, which drives loyal customers to use tokens more frequently.

Phase 2&3 : Accelerate Token Volume & Value

In Phase 2, through the business market expansion to and to wider global market, the ecosystem and economy participants (suppliers, volunteers, customers, Charity) will be rapidly increasing. Consequently, the use case & distributions of DonaBlock tokens will increase accordingly.

When reached in Phase 3, token transactions will be dominant due to increased international transactions. As the token's user base grow, token value and circulation volume will increase.

Inflation (additional issuance of Tokens)

The source of the DonaBlock rewards is the reward pool where the participants themselves generate tokens from actual transactions. The operating costs for the ecosystem is covered by the tokens paid by suppliers when they register products. Therefore, there is no need for token issuance that can dramatically reduce the value of the token. However, for some inevitable cases, inflation might be considered on a minimal scale. When inflation required, the DonaBlock council shall ask prior consent of the community.