NEON is the native coin of the Neon Link network, powering the entire ecosystem dedicated to web3 gaming.

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Today, we’d like to shed light on the intricate and well-thought-out mechanics surrounding the coin’s economy.

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What gives any asset value?

Supply and demand are among the most important factors when considering the value of anything. While subjectivity -value being in the eye of the beholder, so to speak -  is also a consideration, supply and demand are what influences the trend in the price of any asset.

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From commodities like gold and silver to a shiny Charizard Pokemon card, these two factors swing the pendulum of price. When there is more supply than demand, the price falls. When demand exceeds supply, the price increases.

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This is important to reaffirm as we discuss the design of the Neon Link web3 gaming economy.

Supply

The total supply is fixed

This part of the equation can be considered simply: there will only be a maximum supply of 1 billion NEON coins. No more will be created nor exist. 

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However, not all 1 billion coins will be in circulation and therefore, not all of these can be considered as supply at any given time (until many years from now). Over time, the circulating supply of NEON will increase as inflation is strategically implemented to grow the network into a sustainable and thriving ecosystem. Our circulation schedule can be seen below - we have a 10+ year plan for ensuring a distributed holder base.

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Deflationary Mechanisms to Reduce the Supply

Going further, we intend to deploy deflationary mechanisms that reduce the available (or circulating) supply and consequently the total supply over time. As the network becomes more popular for web3 gaming, with a wide range of games and revenue generated, there will be a burning of spent NEON, buying from secondary markets, and burning from revenue generated. This is to counteract the inflation from elements like staking and validator rewards, while also providing liquidity to secondary markets.

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But what about the presale & public sale unlock?

While we have outlined that all coins purchased in the presale and public sale will be claimable  on 15 July, we are not concerned about any short-term holders' decision to sell their NEON upon listings on exchanges, for example. 

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The amount of coins sold at the lowest price expected (presale) isn’t massive enough to cause detriment to those who purchase in the public sale. Furthermore, around this date, we should enter Phase 2 where our network goes live with numerous applications and functionality, such as staking. This should encourage and reward Neonites who are on this journey with us for the longer term.

Demand

While we cannot predict the quantity of demand, we can outline what the use cases are that encourage demand for the asset:

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Staking

• NEON can be used to enhance the security of the network through participation in the PoS consensus mechanism. Through delegating staked coins to validators, the higher participation rate by NEON holders makes it difficult for Sybil attacks for example.
• Therefore, we intend to provide sustainable incentives for Neonites to stake their coins to Validators as we shift to a more decentralised network. 
• By participating in helping secure the network, Neonates will get rewarded from an allocated pool as well as a share of the revenue generated from games on NEON.

Governance

• Owning NEON means you own part of the network focused on web3 gaming. From staking to enhancing the security of the network and earning from revenue generated across apps powered by Neon. 
• You can participate in the governance of the Network, such as creating new proposals and voting on existing ones.

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Unit of Value

• For the Games, Exchange, Marketplace, and all other transactions on the network, NEON tokens will be required to both pay for the purchase as well as a small transaction fee.
• Applications can ‘sponsor’ the network fees for their users to enhance the user experience.

Launchpad Rewards

• Long-term NEON token holders and network participants will receive airdrops and priority for other opportunities as new projects launch on our blockchain network designed for video games. Your NEON is the gateway to the new frontier for web3 games.

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Approach 

Our approach to NEON is not ‘breathe and earn’ or ‘play to earn’ but a sensible and well-thought-out value chain that enables a fair and secure exchange of value between key participants within the industry. 

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As you can see, NEON will be going live with many exciting use cases and sustainable economic mechanisms and we expect that these will grow over time along with the wider web3 ecosystem that is Neon Link.

The NEON Coin presale is coming to an end, having reached the soft cap target, on March 15 with the first coins claimable from the dashboard on July 15. You can purchase NEON using ETH or USDT on Ethereum Network (ERC20), and with enough to cover gas fees.