An Analysis of ShuttleOne Token Economics

This article was published by SnapFingers at the SnapFingers Research Institute.

ShuttleOne provides a bridge for real-world businesses (mainly SMEs) to access trade financing through DeFi via a unique credit scoring system. DeFi farmers can earn stablecoin-based fixed income and SZO token incentives by providing liquidity.

The SZO token is a functional token within the ShuttleOne ecosystem, providing incentives for token holders and liquidity providers (LPs) while ensuring network security. The SZO token was launched on the DODO decentralized exchange through an "initial DODO offering" on 2021/2/22. The SnapFingers Research Institute provides you with relevant information about the SZO token to help you better understand ShuttleOne—a DeFi lending platform that integrates real-world finance.

Token Distribution Model

Total Supply of SZO Tokens: 230,000,000 SZO

Token Type: ERC-20

Inflation Rate: 5% per year, which means 11.5 million SZO per year

57.91%

Unissued Tokens: 133,200,000

The issuance of ShuttleOne tokens follows a burn-and-mint mechanism. Under the lending economic mechanism in collaboration with real enterprises, SZO is minted and burned with lending activities. The annual inflation rate of the SZO token is 5%, with 11.5 million tokens minted each year to continuously reward liquidity providers.

The SZO token mechanism will align the business development of the ShuttleOne platform, the practical value of the project, and the circulation of the token. Simply put, if the business scale does not increase, no new tokens will be minted; conversely, the more lending activities on the platform, the more SZO tokens will be burned.

13.58%

Early LP Program: 31,237,000 SZO

Early LP participants who provide stablecoin liquidity (at least $50) to the ShuttleOne lending liquidity pool can receive rewards from this portion, which will be released 9 months after the token goes live.

Rewards from the early LP program are only available to early beta users of ShuttleOne. Any unclaimed SZO will be included in the incentive pool for LP providers 9 months after the SZO token goes live.

14.31%

Liquidity Mining Incentives: 34,310,660 SZO

Liquidity mining rewards are continuously provided to LPs who supply stablecoin liquidity to the ShuttleOne network. Once this portion of mining rewards is exhausted, the SZO token income generated by our lending business will flow into the liquidity mining rewards pool and be distributed evenly to miners.

This portion includes 5,763,000 SZO locked in the liquidity pool when the token was launched on the exchange (DODO DEX). As liquidity is supplied, the unlocked funds will enter the liquidity pool.

13.59%

Team and Equity Investors: 31,252,340 SZO

ShuttleOne completed its seed round financing in May 2020, supported by several prominent investors, including:

1. Maker Ecosystem Growth Holdings (MakerDAO)

2. Coinshares (Europe's largest BTC fund)

3. CMT Digital

4. Andromeda Capital

5. Sirius Venture Capital Pte Ltd

6. Charlie Songhurst (former Microsoft Strategy Director, took over Skype and Yahoo)

7. Raksasa Business Pte Ltd (Indonesia's largest B2B e-commerce)

All tokens for the team and equity investors will be locked for 2 years from the token's launch on the exchange, and will be released quarterly for 2 years thereafter. Thus, the tokens for the team and investors will be fully released after 4 years.

Functions of the SZO Token

Use Cases

The primary use of the SZO token is for payments within the ShuttleOne network, providing products and services to our users.

Merchants using ShuttleOne.Network products need to pay a certain amount of SZO tokens for services such as on-chain risk management, trade financing credit, KYC, AML regulatory compliance, and remittances. This portion of tokens will be destroyed by smart contracts. Token holders can earn incentives by holding SZO tokens, as the system will destroy SZO whenever a transaction is completed, reducing circulation.

Comparison of Burned Amount and Circulation

Mining Rewards and Governance

Liquidity providers on ShuttleOne.Network enjoy SZO earnings calculated by the second, distributed to liquidity providers per block. The longer the liquidity is provided, the more rewards will increase, up to 1.2 times the base value.

ShuttleOne plans to announce details regarding governance and treasury in the fourth quarter of 2020 and aims to implement governance and treasury usage before the third quarter of 2021.

Audit Information

The contract audit for ShuttleOne was completed by the well-known blockchain security company Peckshield in April 2020, with no major security issues found.

Audit report link:

https://github.com/shuttle-one/flyshuttleone/blob/master/SZO%20Audit%20Report%20April%202020.pdf

SZO Token Circulation Upon Launch

After $SZO was launched on the DODO exchange, the token circulation accounted for about 3% of the total supply, with an IDO price of 0.25 USDT and a hard cap of 200,000 USDT.

How to Obtain SZO Tokens

There are 2 ways to obtain SZO tokens:

1. Provide stablecoin liquidity to the liquidity pool of ShuttleOne.Network. You will receive SZO as a reward for supporting the ShuttleOne protocol.

2. Purchase on exchanges or other secondary markets.

ShuttleOne does not conduct token sales and does not raise funds through token issuance. The initial DODO issuance of SZO adopted a "crowdfunding pool" method, and the raised tokens will be locked in the pool to provide liquidity. For more details on the crowdfunding pool, please refer to the official DODO blog.

ShuttleOne 2021 Roadmap

Q1 Plans:

1. Launch on DODO decentralized exchange for IDO on February 22.

2. Add BTC and ETH liquidity pools to the ShuttleOne lending platform.

3. Increase fiat channels to 80 different countries.

Q2 Plans:

1. Integrate with Maker protocol.

2. Add SZO governance and insurance modules.

3. Launch ShuttleSwap, where the lending platform's liquidity pools will support more types of mainstream coins.