Proposed ARX Tokenomics and SWAP details

By May 3, 2019Arax Crypto Wallet
Arax Coss merger

PREFACE: We kindly recommend that you take the time to read through this document carefully, as this is a fairly detailed document. There is also a YouTube video that we encourage you to watch which should answer some of the common questions you have.

Do take note: The scope of this document focuses only on the ARX token and SWAP details for the community to vote on. More detailed announcements on how and when the swap will take place will be released in the month of May once we have firmed up the technical swap details.

1. What is ARX?

ARX is the new multi-use-case cryptocurrency utility token, that enables token holders to benefit from a variety of use cases across multiple platforms than just one single utility, such as (but not limited to) the COSS Exchange, the ARAX wallet, Decentralized Exchange and many more products and features to create a unique ARX ecosystem.

2. ARX Token Utility

We are proposing four major utilities as described below. ARX token will become the native token across the entire ecosystem and will have multiple use-cases added that will enhance the value of the FSA

  1. FSA: Fee Split Allocation

Through a unique DAO (decentralized autonomous organization) system as before in COSS, the holders of ARX tokens will be eligible to receive a portion of the trading fees generated on COSS (Centralised Exchange) and upcoming COSS-X (Decentralised Exchange). As a result of this, we expect the FSA to benefit from increased user sign-ups and trading activity across two exchanges. FSA % on COSS will stay at 50% as before. FSA % on COSS-X will be confirmed at a later date but we are expecting between 25–50%. FSA % fees for most other products that are planned to release will be determined as we launch these products in the future keeping in mind costs, net fees, and current regulations.

2. Trading Fee Discount*

Use the ARX token to pay your trading fees on COSS and COSS-X and obtain a 25% discount on your trading fees, just like the previous CFT Token. Net fees collected will be part of the FSA (see above)

3. Time Deposit (TD)*

A new utility previously not present in COSS/CFT/LALA tokens: Time Deposit (TD). Time Deposit is a feature inside the ARAX App where ARX token holders can lock up their tokens and earn Time Deposit rewards as proposed below. One can enter multiple Time Deposit options for 3 months, 6 months, 9 months, 12 months, 18 months and 24 months. Furthermore, while your tokens are in TD contract, they will still be eligible to receive FSA. That means more earnings if you hold your tokens in TD, and not just the FSA. TD rewards will be added to your balance upon maturity of your chosen TD contract.

We believe this is a great addition to the already existing utility of the token. While the FSA and Trading Fee Discount get rolled into one single ARX token, the addition of TD creates a massive opportunity for all, especially the long term holders. However, this feature demands that we increase the supply by a little bit as proposed in options below:

Arax and Coss tokenomics 1

4. Buy-back/Burn

On a quarterly basis, the group of companies in the ARX ecosystem will use 20% of its net profits to buy back ARX tokens (Profit Tokens) from the open market.

  • 50% of these Profit Tokens will be burned through the built-in Zeppelin burn function in the ARX smart-contract
  • The other 50% will be used to refill the Time Deposit pool, ensuring that the TD reward program can continue to run seamlessly
  • The burn will stop once the max supply reaches back to 200m. ( regardless of option A, B, or C as proposed below in section 4 )

3. Advantages of the New Ecosystem

We understand your concerns. Token dilution is not something anyone wants. But we would ask you to consider this: It is not possible to combine 3 token supplies together and expect the final token supply to remain the same in percentage. What we CAN do, however, is keep the supply increase to a minimum, AND enumerate for you why combining the tokens will be beneficial for you in the long run.

Combining COSS, CFT and LALA tokens into one ARX token gives various advantages:

  1. Bringing our communities together
  2. Create new utility use cases and cost benefits that would not have been possible before
  3. A larger ecosystem that benefits the FSA in the long term and creates a stronger, more sustainable platform
  4. More technology and marketing resources leading to cost efficiency and faster go to market
  5. A combined entity makes us more attractive to partners, vendors, and investors leading to ecosystem growth
  6. More products, features, and revenue which should ideally benefit token holders through the FSA as well as other utilities

Arax x

* FSA % on various products and features going forward (except the already committed FSA % on COSS Trading fee) will be determined as we plan and launch these products in the future keeping in mind costs, net fees, and current regulations.

** Some features & products are from third parties partners as we don’t intend to / can’t build everything ourselves

*** We are going to run master nodes of several PoS Tokens and split a portion of that net fee with the community as above. Users can also stake their own coins, earn staking income as a feature via our master nodes, as well as earn on the FSA at the same time. Net fee will depend on the operational cost of running the master nodes.

*We have not decided the date and plan to release this and many other products yet. We are working on the product roadmap.

4. Proposed Token Options

What were our thoughts behind these numbers regarding Ratio, Communities, and Companies:

Obviously, we felt that all would agree that the most valuable use case was with the COSS token and its FSA hence why we decided to use the COSS token as the benchmark in the proposal. We then looked at the price of all 3 tokens before the pre-announcement.

Then we took into consideration CFT that was originally 10 cents per token. CFT token holders will now get an added valuable use case through the FSA that also will work as compensation over time.

The most difficult one was definitely the LALA token. Regardless of how we twisted our brains, we ended up with plus and minus on all proposals and either way it would impact one or the other. Here we also looked at what the company and the community bring to the table through a solid up and running dev team, marketing team and an existing community. The LALA community also have a solid base of very loyal long term holders even without a recurring use case such as FSA. This part alone is a very valuable addition to any community.

We certainly hope and feel that we have landed on some decent proposals that the communities can come together on, and start delivering on multiple products that we have planned for the ARX ecosystem.

We present three options below: Option A, B, and C.

arax and coss x*These tokens are not eligible for FSA until after distribution in the future

EXPLANATION OF FUTURE TOKEN USAGE:
Future Funding Pool: Most of this pool is a continuation of the token pool from previous COSS/LALA funding token pools. This will be used to secure the companies future and to ensure proper ecosystem growth by having funds available for issuing to partners, vendors, certain payments and acquiring of projects that fit the profile of the ecosystem. Tokens used here will only go into the FSA calculation and circulation when used. On certain projects, the community will be able to participate in decision making through voting.

Airdrop/Promotions/product marketing: A liquid token is very attractive for marketing agencies within the crypto space and we have already utilized this option earlier to pay for marketing with tokens as well as various schemes to current holders and/or external holders to bring them into our ecosystem. Media and PR are essential in crypto space today and can be leveraged via ARX token payments. Incentive schemes for marketing agencies, media partners, various freelancers who help us with the content, etc are all earmarked for payment via this pool.

Charities: In line with our original whitepaper we wish to uphold this profile, but also to expand it into scholarships for tech students in 3rd world countries where these students can become future assets for the ecosystem at the same time as they get an education and a more prosperous future. Charity donations will be based on community proposals and voting. LALA/ARAX has also been at the forefront of financial inclusion and charity. As a combined entity, our goal is to give back to society and create a better place. A formal plan, structure, and features are being planned to be utilized via this pool

Bounties/referrals: We wish to build a strong referral program across the entire ecosystem and bounties are always essential in this line of business, whether that be for aiding on marketing and/or for ecosystem security measures (hacker bounties etc). This not only helps us to create a larger community but also create brand awareness.

Employees/Advisors: As we grow products and geographies, it is very essential we put together the best of the best team. Advisors as well as employees. We are in talks with several new hires for new products as well as a board of advisors to give us strategic direction. Everything is planned and will be announced in time. These future colleagues also need to be incentivized and have their skin in the game at the same time.

5. How to Vote

We would like to have your feedback on the above-proposed ratio and token supply. Again, we appeal to you to read the entire document carefully. Think deeply on this, discuss amongst yourself and feel free to ask any questions you have before voting starts.

We will release the link for the community to vote on the 6th of May, Monday, 9 AM, SG time.

Terms and conditions:

  1. You must use your ARAX App ID ([email protected]) OR your COSS registered email to vote
  2. Voting starts on the 6th of May, Monday, 9 am, SG time and ends on the 8th of May, Wednesday, 2 pm, SG time
  3. Only 1 vote per account is allowed, and revisions are not allowed
  4. In the event of a stalemate, the company reserves the right to take a decision at their own discretion

Results will be published and announced on the 8th of May, Wednesday, 4 pm, SG time.

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