Flame DeFi: An Upcoming DEX on Tezos with Interesting Tokenomics

By 2sats | 2sats | 3 Nov 2021

*obligatory not financial advice*

62eb35ccbbecc0341f31d8e4453e26bdf523bdec2c97c6e0813532441f4d9cc2.png

What is Flame DeFi?

Flame DeFi is a combination of a decentralized exchange and a farming tool that is running on the Tezos blockchain. Tezos has much cheaper fees and is much faster than Ethereum, so it is easier for normal people to use dApps there. Tezos has other DEXes like Quipuswap or PlentyDeFi and they all have something special about them to differentiate them from the other ones. Flame has its SpaceFarm, that lets people earn tokens by staking the native utility token called FLAME and other tokens as well, it also has a lottery section where you can gamble with FLAME. The FlameDEX will partly reward FLAME hodlers. So far only the Farm is available, the DEX is still being built.

0e6c30548df75cc4d1a215e968664ca1ceadb7cd1eba1a7537004aa26c23a637.png

The Tokenomics

FLAME is the main token of the platform that you can currently only buy on Quipuswap. It will mainly be used for rewarding its hodlers with burning but it can also be staked on the farm to earn other tokens. The SpaceFarm also has a lottery feature where you can play Poker or a slot machine and bet FLAME to maybe earn more.

It had an initial supply of 310,000,000 tokens and the devs received 10% of the amount of tokens sold in the presale. There is no max supply and it is technically highly inflationary because it can be farmed with a high APY at the SpaceFarm. However, there are quarterly buy backs and burns of tokens to keep the inflation in check while still letting new members join the farming. This burn mechanism and farming rewards will be adjusted after the DEX launches, but the goal is ultimately to make the token deflationary with the help of the DEX.

The DEX will have a swapping fee of 0.3%, of it 0.25% will go directly to liquidity providers and the other 0.05% will be used to reward FLAME holders by using 90% of it to buy and burn FLAME and the 10% for buying fDAO tokens and giving them to people that stake their FLAME in locked staking.

fDAO is the governance token of Flame DeFi. While FLAME gives its hodlers rewards, fDAO gives them voting rights. There was an initial supply of 5,500 fDAO of which 4,000 were sold in a presale and the rest was given to developers. There is a max supply of 100,000 tokens and there will never be more, so the initial supply is actually only a very small amount of the total supply, most of it can be farmed via the SpaceFarm. As mentioned before, FLAME stakers will be able to earn fDAO as reward since the DEX will use some of the fees to buy it for them. This gives the token a constant buying pressure if the DEX is used enough.

There is quite a lot of competition for a new decentralized exchange on Tezos, but the SpaceFarm and lottery seem like cool features and the DEX will have plenty of ways to reward token holders, so it might become very successful.

03328dd987b4bd5caf471565a8ab5ee74762c5595ec1ace31da1656321ff3bf5.png