Defining a Fair Launch Game Token

A fair launch game token should not have any existing stakeholders, investors, or token holders. It is launched to the market with no supply of the token pre-owed to any stakeholders. The token is open for any user or investor in the open market to acquire, and for in-game players to mine the rewards and incentives for playing the game.

When investors in the open market purchases the token, it should cause the value of the token to increase, thereby raising the value of the game economy that benefits users that play the game for the rewards, rather than benefiting prior stakeholders that hold the token that has not been purchased from the open market.

The main drawback of a game token that has a presale or investors that hold the token before it launches is that when open market buyers acquire the tokens, it creates a challenging environment for the market to decide the fair value of the token. It frequently leads to a massive demand shock, particularly if the game token has raised a significant sum of capital before launching the game.\

IE, should investors value the game token based on the game's on-chain revenue or traction? or based on the fact that x% of the supply would unlock to pre-existing investors?

As an example, say if external investors hold 15% of the supply of the token that is meant to support the economy of the token:

It becomes very difficult to gauge the market demand for the token before launching the game. It is also hard to launch the game token after launching the game and projecting the economy of the game because the game cannot operate without the token as the foundation layer. This causes games to often launch tokens without having clear projections of the growth of the economy while having a large supply ready to be unloaded, causing a demand shock.

Our thesis is simple; if we can prevent a demand shock from the beginning, it would increase the probability of a game and token economy’s success at longevity. It would at least, as bare minimum, create a fair environment and balance between open market buyers of the token and in-game players.

A token used in-game should enable a non-inflationary economy that supports a merit-based gaming environment. Players must be empowered to earn the rewards inside the game without being interfered with by external parties whose interests are not aligned with the players, as it can cause a demand shock for the currency that poses as the very foundation of the game economy itself.