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Token Overview
The Glue token is a pivotal component of the Glue Network, serving as the primary utility, governance, and gas token within its comprehensive ecosystem. Notably, the Glue token functions as the universal gas token across both the Layer 1 (L1) and all use-case optimized Layer 2 (L2) solutions within Glue. This Unified Token Model simplifies transactions, as there is a single gas token that operates seamlessly across the entire Glue ecosystem.
Genesis Token Allocations
The initial distribution at the genesis block is strategically designed to align the interests of various stakeholders and facilitate the long-term sustainability of the ecosystem.
Seed Contributors: 0.99%
Liquidity Bootstrapping Pool (LBP) Contributors: 0.37%
Other Expenses Paid in Tokens: 0.20%
Founders Allocation: 15% (subject to a five-year vesting schedule with a one-year cliff)
Foundation Allocation: 10% (earmarked for operational funding and market-making incentives)
In total, these allocations account for 26.56% of the total supply, leaving 73.44% in the on-chain treasury for future initiatives and ecosystem growth.
Seed contributors played a vital role in the initial development of the Glue ecosystem. They were allocated approximately 1% of the total supply at a 30% discount to the LBP's lowest price to compensate for their early investment.
You can learn more about this by reading the Initial Capital Raise section of our white paper.
LBP (Liquidity Bootstrapping Pool) Contributors
Total Contribution: $2.5 million
Average Price: $0.668 per token
Total Tokens Sold: 3,738,525
LBP contributors participated in a public market event where the price of the token was determined through a liquidity bootstrapping pool (LBP), ensuring a fairer and more dynamic distribution at market rates.
The aim of the LBP was to raise $2.5 million, with 0.5% of the total token supply allocated for this purpose. However, the target was successfully reached after only 0.37% of the tokens were sold, leading to an early conclusion of the LBP.
You can learn more about this by reading the Second Capital Raise section of our white paper.
Other Expenses Paid in Tokens
Total Contribution: $500,000
Conversion Price: $0.253 per token
Total Tokens Sold: 1,976,284
A portion of Glue tokens was allocated to cover early expenses and service providers, compensating them at the seed contributor pricing.
Founders Allocation
The co-founders, Ogle and SnapShot, have been dedicated to developing Glue since 2021, each investing $500,000 of their own funds.
To ensure the founders remain committed to the long-term success of the network, 15% of the total supply has been allocated to them.
These tokens are subject to a five-year vesting period with a one-year cliff. This means that the founders cannot access any of their allocated tokens for the first year, and thereafter, their tokens will be gradually released over time. Vesting period doesn’t start until TGE (token generation event).
You can read the Founders Tokens section of our white paper, and see answers from Glue co-founder, Snapshot, here, to learn more.
Foundation Allocation
The Glue Foundation has been allocated 10% of the total token supply. This allocation will be used to manage future token sales, incentivize market makers, and provide operational funding as the ecosystem expands.
The remaining tokens will be held in the on chain treasury, representing 73.44% of the total supply. This unallocated portion will be crucial for future growth, development, and strategic initiatives, ensuring that Glue has the flexibility and resources needed to achieve its long-term vision.
The terms of the initial fundraising round were straightforward: contributors received a 30% discount on the price of tokens in the subsequent fundraising round, which ultimately took the form of a Liquidity Bootstrapping Pool (LBP).
The 30% discount was applied to the lowest price achieved during the LBP.
This initial round was spearheaded by the two founders, Ogle and Snapshot, each contributing $500,000 at the same terms as all other contributors in the round.
In addition to the founders, including SnapShot, a member of the Young Presidents Organization (YPO), approximately 20 high-net-worth individuals, mostly YPO members, participated. They collectively contributed an additional $1.5 million, bringing the total capital raised to about $2.5 million.
The largest contribution besides the founders was $250,000, hence, there are no seed stage whales.
You can learn more about this by reading the Initial Capital Raise section of our white paper.
I am concerned about the unallocated tokens!
We understand that concerns regarding unallocated tokens are common among token holders. However, it is important to note that these unallocated tokens are not merely sitting idle. They are held in a decentralized treasury, controlled through governance votes by all Glue token holders. This ensures that any future distributions or uses of these tokens will be made with careful consideration of their impact on the token supply and overall market dynamics.
Additionally, the foundation must demonstrate that they have made prudent decisions and executed effective strategies to receive funding again. The treasury is not at the foundation's disposal to use as they please; rather, it is subject to community oversight. Token holders possess the authority to decide how these tokens are utilized.
Why does the foundation only receive 10% of the total supply?
The decision to allocate 10% of the total supply to the treasury is rooted in the belief that excessive funding can lead to inefficiencies and centralization within the ecosystem. A smaller treasury encourages more strategic and responsible use of funds, promoting accountability and ensuring that initiatives funded by the treasury directly contribute to the network's growth and sustainability.
How does 10% allocation to the foundation align with the governance model?
This allocation strategy aligns with the Glue Network's decentralized governance model by encouraging community involvement in decision-making. With a limited treasury, token holders actively participate in governance votes to determine how funds are allocated, ensuring the community's interests are prioritized.
As the foundation is designed to exhaust its funds over time, any potential refunding becomes a governance proposal. If the community is dissatisfied with the foundation's performance, they can propose new ideas and initiatives for funding or choose to fund projects for shorter periods.
The aim of the LBP was to raise $2.5 million, with 0.5% of the total token supply allocated for this purpose. However, the target was successfully reached after only 0.37% of the tokens were sold, leading to an early conclusion of the LBP.
To quote our co-founder Ogle:
"The price was getting very high, and the raise goal was hit, so we ended early. If we hadn't, fdv would've been even more insane, and anyone buying likely would've been in a precarious position in the nearish future at least. So to protect those investors, we decided to do what we said we'd do and end it, rather than raising more money."
What is the vesting for the LBP tokens?
There's no vesting for anyone who participated in the LBP for the tokens that they purchased.
You can listen to Glue co-founder, Ogle, here, to learn more.
How will the Glue token accrue value over time?
You can listen to Glue co-founder, Snapshot, discussing this topic here.
What is the benefit of Glue's high valuation?
You can listen to Glue co-founder, Ogle, discussing this topic here.
