Incentivized Token Issuance – Is It Worth It?

Blogs 03 Incentivized Token Issuance - Is It Worth It?Viewing is for educational and entertainment purposes only. Not financial advice.

Offering rewards and incentives is common practice when a project is working towards building its’ ecosystem. We see it at the biggest exchanges – such as Binance – who offer great financial rewards or incentives to customers who use Binance Coin, or BNB.

Other companies like COMP experienced popularity and growth thanks to token loan incentives. However, this reward was due to loopholes in their liquidity pools, which rewarded loan takers with COMP tokens the more they took out loans.

The rewards were higher than cost of the loans resulting in yield farmers taking out continuous loans to earn COMP tokens. This positive feedback loop inorganically skyrocketed the price, however a community vote eventually changed a mechanism in the system that no longer enabled yield farmers to take advantage of the incentive.

While incentivised token issuances are extremely beneficial for a company and can result in enormous financial gains in a token’s value, it is actually a dangerous game to play for those who are in the ecosystem. It creates an overwhelming inorganic bubble that will plummet the value of the token when the bubble is popped.

At CoinFLEX, we see the health of our ecosystem, our community, and the crypto industry as a whole as a more significant priority over fast profits. Our company growth is not based on incentivised token issuance. We view the growth of our token as a reflection of the quality of our company and size of adoption.

The health of a company should not be dependent on them asking you to use their products. At CoinFLEX we incentivise the crypto community to our products by offering you the best results.

To highlight the quality of our products, it is best to compare them to competitors within our field. For example, our flexUSD yields outperform those at Compound or AAVE, even though both incentivise lenders and borrowers to participate through handing out their tokens.

While this week’s USDC APR interest rate for AAVE and COMP are at 1.85% (30 day average) and about 1.58% respectively, flexUSD is experiencing a current 4.20% APR (30 day average), with some 8 hour payment periods rising as high as 33.78%. Organic growth provides a more sustainable ecosystem, which CoinFLEX still manages to achieve while offering higher rates.

Many will stay with bigger crypto companies simply out of comfort, however in order to grow we need to step outside our comfort zones and experience different opportunities. After all, we all took the plunge when experimenting with Bitcoin.

If you are willing to increase your profits from passive income, come over CoinFLEX and exchange your stablecoins to flexUSD. You earn interest every 8 hours simply by holding the coin, which you can even do on cold storage. No staking required!

To buy flex assets check out https://coinflex.com/flexassets

Author: Adam Diaz

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