ADAO Tokenomics

AlgoDAO has a unique dual-token tokenomics that includes the ADAO token and the SIGMA token.

ADAO’s Core Utility

ADAO is the governance token of AlgoDAO. Staking ADAO enters you to membership in AlgoDAO’s Federation tier, and the membership entitles you to participate on funding rounds and to receive rewards from SIGMA pool. You can also delegate ADAO to become a High Council member. Your membership tier determines your maximum price allocation, how early you can participate in funding rounds, and the price in which you join the rounds.

SIGMA Token’s Core Utility

The SIGMA token is the utility token of AlgoDAO’s SIGMA pool. Burning the SIGMA token entitles you to a pro-rata share of the SIGMA pool so you can get project tokens from projects launched through AlgoDAO.

Token Distribution

ADAO’s token distribution is designed to align the interests of all ADAO participants, elicit maximum commitment, and demonstrate an understanding of sound economic principles and behavioral science. The token distribution, what each distribution is meant for, and the cliff and vesting schedules are provided below.

Distribution	Meaning	% of Total Supply	Initial Unlock %	Cliff (Months)	Vesting (months)
Seed round	ADAO tokens accessible to institutional investors	10%	7.5%	3	36
Private Round	ADAO tokens accessible to institutional investors	5%	7.5%	3	36
IDO	ADAO tokens available to retail participants	1%	100%	0	0
Strategic Partnerships	ADAO tokens reserved for consolidating ecosystem relatonships	6.50%	1.25%	2	28
Team	ADAO tokens reserved for the core team building AlgoDAO	18%	1.25%	3	48
Advisory & Marketing	ADAO tokens reserved for advisors and marketing spend	5%	1%	3	48
Token Liquidity	ADAO tokens to pursue listing on exchanges	5%	12.50%	1	12
AlgoDAO Ecosystem Fund	ADAO tokens reserved for collarboration and growth in the wider Algorand community	20%	5%	0	15
Community Incentives	ADAO tokens reserved to incentivise community activation, participation and growth	12.50%	0%	0	48
Liquidity Mining	Tokens reserved to incentivze and reward liquidity mining	7%	5%	0	48
Token staking	Tokens reserved to incentivize and reward ADAO stakers	5%	5%	0	8
Insurance fund	ADAO tokens reserved to manage ADAO put options	5%	0%	1	8

What was the price paid by strategic partners for the ADAO token?

Different early funding rounds had and have different pricing structures, depending on the different risk profiles of the project over time, in its various inception stages.

What is the price of the token that will be sold to the retail market?

The AlgoDAO supporters are currently planning an IDO price of one USD (USD 1.00).

Will the ADAO token be available on Binance Smart Chain or only Algorand?

For the start only on Algorand, however, we may look to migrating to other chains to increase the ADAO liquidity.

From where does the ADAO token derive its value?

Is ADAO an ERC20 token?

No, ADAO is an ASA (Algorand Standard Asset) token.

The value of ADAO reflects the quality of the projects that we incubate and launch. It is also a function of community contributions if the community is active in governance etc, flywheel effect. The Max supply will be 100,000,000 ADAO and there will be a tokens burns mechanism by the constant token burning from unstaking ADAO tokens, withdrawing from Sigma pool, and more.

What is the ADAO Charge?

Once a user decides to unstake a partial (or total) amount, they incur a fee, called ADAO Charge of 6%. This fee is burned forever.

What is a Pool Weight Multiplier?

Everybody will receive an allocation limit in the IDO according to the weight multiplier of his/her tier. For example, if a Fleet commander has a pool weight multiplier of 3 that means users in that tier will receive 3 times higher allocation than the Ensign tier, which has a multiplier of 1. Finalized allocation limit in USDC depends on the IDO size and amount of registered participants and it is defined after the whitelisting procedure is done.

What are Participation Odds?

Participation Odd Multiplies refers to users' chance to ‘win’ the ability to participate in an IDO on AlgoDAO.

AlgoDAO members in any other tiers, except for Tier 1 members, have their stake weighted for participation multiples. Simply put, each user that is not a Fleet Commander (Tier 1) member, must pass this random draw system. This system works 100% using random modules.

This means a Flagship Commander Tier 2 member with 12,000 ADAO staked receives 400 ‘participation odds multiples’ —which is the maximum number of tickets a user can have. A Vice Admiral Tier 3 member with 4,000 ADAO staked receives 100 ‘participation odds multiples’. A Lieutenant Tier 4 member with 1,000 ADAO receives 20 ‘participation odds multiples’. An Ensign Tier 5 member with 1,000 ADAO has 1 ‘participation odds multiples’.

How does ADAO Delegation Work?

Stakers can work together to gain access to higher tiers by forming ‘ADAO access pools’. In this way, several Federation Members can pool their stakes to get access to the perks of Guild Members. This feature will be developed in the future in the phase 2 development roadmap.

Can I stake ADAO?

Yes, of course! Staking allows you to participate in the ADAO ecosystem by reaching a particular tier. The tiers determine users' allocations and participation odds and are parametrized with Pool Buff, Participation Odds Buff, Odds Booster, and the Participation Fee.