Community Offering and Tokenomics Update: A Closer Look

  • Community Offering
  • Fair Launch
  • Launch Date
  • Tokenomics
  • Use of Proceeds
  • Security, and more

The Problem With Current Launch Models

Stealth LP Pools (Common for OHM Forks)

Stealth LP pools reward bots, insiders, and whales. Although these select individuals achieve anywhere from 10x to 50x, everyone else is left buying a token that has run up tremendously.

Whitelists

Whitelists often have very unclear guidelines on how to gain access. They force fake interactions on Discord and result in people begging for access.

Pre-Sales

Pre-sales frequently have unfair allocations, including restrictive lists and discounted prices (or increased allocation) for team and “contributors”. These discounted prices and team allocations are often “black boxes” — they are hidden / not disclosed to the public, and the pre-sales often sell out very quickly leaving most of the community unable to participate. This structure also results in an imbalanced distribution of tokens, with a small number of holders owning most of the network.

Rugpulls

We have unfortunately seen a number of rugpulls occur recently, including multiple OHM forks. These forks did not have multi-sig contracts in place, tokenomics were ambiguous, contracts were not public, etc. etc. Magnet DAO aims to be as transparent as possible with everything we do. This includes peer reviewed code, multi-sig contracts, budget for Tier 1 audits, open-source smart contracts, pre-defined token allocations with 0 ambiguity, confidential KYC via RugDoc, and a team that prides itself on answering questions posed by the community.

A Better Launch Model

The Magnet DAO Team carefully considered all the issues mentioned above and has designed a launch model aimed at promoting (i) transparency, (ii) fairness, and (iii) community.

Community Offering (December 7th, 5:00pm UTC)

Contract has been peer reviewed by 2 unaffiliated, experienced developers. We will also be submitting a RugDoc once the contract is uploaded, prior to the Offering.

  • Sold at a fixed price of $0.80 per token
  • Max contribution of $500 per person, which increases to $4,000 over the course of an hour
  • Only available to those on the Discord List (see “How can I get on the Discord List?”)
  • Proceeds used to propel near-term growth: top tier audits, marketing budget, and $ to bring on additional top-tier blockchain developers

Fair Launch (December 27th, 5:00pm UTC)

  • 4.0M tokens for sale (40% of initial total supply)
  • Price is dynamically determined by amount contributed — more details to come in the coming days / weeks via a separate Medium article. We have a lot of unique ideas for how to structure this launch and are firming up the details
  • ~45 hour launch
  • Max contribution of $50,000 per person
  • Available to anyone who wants to participate
  • All proceeds go to our treasury — allowing us to launch with a substantial treasury and a low market cap / treasury ratio to begin with

Protocol Launch (December 29th, 5:00pm UTC)

  • Protocol will launch ~3 hours after the fair launch is completed
  • The proceeds from the fair launch will go directly to our treasury
  • We will then add liquidity to Trader Joe and launch the protocol, allowing staking and bonding

Key Questions

Why are you doing two rounds?

First Round (Community Offering):

Other OHM forks have been launching quickly, why is it taking you so long?

OHM is an extremely complex protocol. While it is very simple to fork and launch a “working” product quickly, it takes time to thoroughly understand the code and to innovate upon it. Safety of our users is our number one priority, especially after all that has happened in the last few weeks. Here are some considerations:

  • Audits — we want to make sure our code is thoroughly audited by the best auditors before launching
  • Multi-sig — everything done by our protocol will involve multi-sig contracts. No native multi-sig UI exists on Avalanche so it takes time to build out these mechanisms
  • Parameters — most forks launch quickly and use the same code as OHM or TIME without understanding how to properly adjust bonding mechanics. These parameters are absolutely critical to ensuring the protocol’s health, and to prevent pump and dump price action
  • Launch — we are building our own launch contracts and developing novel launch mechanics from scratch for both our Community Offering and fair launch
  • Tokenomics — we have taken extensive community feedback to ensure our tokenomics are fair and sustainable for both our tokenholders and team in the short and long term
  • Innovation — we don’t just want to launch a simple OHM fork as we don’t see any value in that. We are building unique features into the protocol which take time

Community Offering — Important Things to Know

Note: The fair launch is planned for December 27th and more details will be released in the coming weeks. All Q&A below is in reference to the Community Offering.

How can I get on the Discord List?

We took a snapshot of our Discord on November 30th at 2:00am UTC. If you were in our Discord at the time this article was posted, all you need to do is to head over to the channel #verify-bot on our Discord server and use the command !magverify, our bot will then DM you to register the address you plan on using during the Community Offering. You need to get your address registered by the bot before December 6th at 8:00pm UTC to be eligible for the Community Offering.

When is the Community Offering?

The offering will take place on December 7th at 5:00pm UTC. The contribution cap will increase every 15 minutes for 1 hour. The offering will go on for 24 hours, or until all available aMAG is sold.

What is aMAG?

aMAG is an NRT token (Non Transferable Token) which means it cannot be transferred or used to supply liquidity — it can only be redeemed. aMAG will be redeemable 1:1 for MAG directly prior to launch. The reason we are using an NRT token is to prevent non-approved liquidity pools from being launched prior to our official listing, which we have seen become an issue in other projects.

How much can I contribute?

The maximum allocation per person starts at $500 and doubles every 15 minutes, until a cap of $4,000 per person is reached (this would be 1 hour after launch, if we are not sold out by then).

Am I guaranteed an allocation?

No — the launch is first come, first serve. It is possible that we sell out in the first round, so not everyone is guaranteed an allocation. The launch is set up to try to ensure that everyone gets some amount of allocation, but we recommend you are at your computer or phone and are ready to contribute when the launch starts / at every subsequent increase in contribution cap.

Which stablecoin do I contribute with?

The community sale will be done using MIM, which can be purchased on Trader Joe.

How many tokens are for sale?

We will be selling 2M tokens, which is 20% of initial total supply

How much is each token?

aMAG will be priced at $0.80 per token. Thus if all 2M tokens are sold, we will have raised $1.6M. This values the protocol at $8M on a fully diluted basis. Note that the $8M FDV includes 45% of tokens, which when sold, all proceeds will go to our treasury, adding a substantial floor to the $8M valuation.

How is it structured?

A total of 2 million aMAG tokens will be up for grabs during the Community Offering. aMAG will be redeemable, 1:1 for MAG, prior to our public launch.

Why did you structure it this way?

We felt that $1.6M was an appropriate amount and that $8M FDV was fair. With these two parameters set, it became an optimization equation for two things:

  1. Allow for as many participants as possible

Use of Proceeds and Tokenomics

What will you use the proceeds from the Community Offering for?

The use of these proceeds will be as follows:

Tokenomics

Initial Total Supply of 10M MAG broken down as follows:

SCAM Alert

Please be aware that there is a possibility that fake MAG tokens are created. Do not buy anything that is not posted on our official socials / website. The date, time, and contract address will all be very clear. We are not going to be stealth launching and you will know well in advance when our offerings and launch are. Please also be aware that Magnet DAO Team Members will never reach out to you first. Always ensure you have the right token address and website URLs. All information will be posted via Magnet DAO official platforms:

Disclaimer:

Please note: participation in these offerings comes with abundant risk. There is no guarantee your investment will perform well, or that the protocol will be successful. Please only contribute what you are comfortable losing. Our Initial Discord Offering contracts will not be officially audited and thus could be prone to exploits. Crypto is risky in nature and you should always exercise risk management and caution.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store