Interpreting 5 Cases of Token Migration or Merging: How to Give Tokens a "Second Life"

Original source: panadol girl X account

Author: panadol girl, Crypto KOL

Compiled by: Felix, PANews

If you are a project founder looking to upgrade or migrate your old token; merge with another token to give it a "second life," and reshape the token economics and utility. Then this article may be helpful to you.

Some may argue that projects only have one chance to issue tokens, but the reality is that markets and narratives change, team strategies and visions evolve, and even community expectations shift over time.

In this context, the token brand and market positioning may need to be updated to remain relevant, and the token utility will change accordingly. Founders and teams should have this option as long as it is reasonable, well-considered, and agreed upon by the community.

This article conducts an in-depth study of five token migration and merger cases to gain a more comprehensive understanding of key considerations, conversion mechanisms, timelines, price performance, and community responses.

• MC --> BEAM
• RBN --> AEVO
• AGIX, FET, OCEAN --> ASI
• KLAY, FNSA --> PDT
• OGV --> OGN

First, let's summarize the main considerations:

1. MC --> BEAM

The migration of Merit Circle to Beam may be one of the most successful and mature token migration cases. It is a great example of how a project evolves into a blockchain with clear and consistent community communication and proposal processes. Detailed timeline:

Why upgrade?

• Better alignment of token branding and underlying network.
• Enhanced token utility.
• Market positioning, brand awareness, and strength.
• Ability to quickly combine the attention of internal and external parties with BEAM's new vision.

Why not just a token airdrop?

• BEAM is intended to replace the MC token, not coexist.
• Due to the constant trading of MC tokens, it is difficult to conduct a fair and accurate airdrop.
• Significant costs (including transaction costs).

Price impact

• The price of BEAM rose about 200% in the six weeks following the migration, indicating strong market support.
• Since the migration began on October 26, 2023, the price of MC has also surged more than threefold.

2. RBN --> AEVO

In the DeFi space, the merger of Ribbon Finance with Aevo is an interesting case that integrates an automatic staking mechanism into the merger process.

2 different products and 1 RBN token --> 1 unified product and 1 new AEVO token.

The timeline is as follows:

Why merge:

• To address the scalability issues of DeFi options, which Ribbon struggled to scale.
• Product supply synergies.
• Technical advantages in UI/UX: Aevo L2 rollup aims to provide users with zero gas fees, reduced order delays, improved order processing capabilities, active market-making, and more.
• Direction and goals: The new AEVO token is based on a clear and evolving goal of becoming a high-performance derivatives trading platform and offering more products under one brand.

Staking mechanism:

The converted AEVO token has a 2-month lock-up period. AEVO tokens are converted to sAEVO (staked AEVO), which are then locked --> to avoid immediate sell-offs that could lead to price volatility.

3. AGIX, FET, OCEAN --> ASI

One of the hottest merger cases this year is the merger of three high FDV AI tokens: Fetch.ai (AI agents), SingularityNET (R&D for AI development and integration), and Ocean Protocol (data sharing and monetization). When this news first emerged in March, the team immediately communicated with Singularity to understand its rationale and mechanism.

The key takeaway from this case is their thinking about the exchange rate and why they did not apply any type of premium or discount to the token valuation.

Why merge:

• To consolidate liquidity ------ liquidity is expensive.
• To create the largest independent player in AI R&D.

Exchange rate:

• The exchange rate is based on the average price of the last 15 days before the announcement.
• To reduce barriers in valuation negotiations, the team simply valued the tokens under the same market conditions, without applying premiums/discounts based on liquidity/trading volume differences.
• FET was chosen as the base token, so the ratio with ASI is 1:1.

You can find the ongoing two-phase merger process by clicking link.

4. KLAY, FNSA --> PDT

This year, the two largest tokens in South Korea also decided to merge, one supported by Kakao and the other by LINE, both of which are the largest communication apps in South Korea. Their vision is to become the number one blockchain in Asia, leveraging their user base of over 250 million wallets and more than 240 dapps and services.

The key point of this case study is the burn mechanism, where:

• 22.9% of the total supply of the new PDT token will be burned.
• All non-circulating supply will be burned.
• Purpose: to reduce inflation and control supply.

They released a very comprehensive document explaining this process and providing clear mathematical guidance.

5. OGV --> OGN

Purpose: To integrate all of Origin's product suite into a single governance and revenue token OGN. To consolidate liquidity.

The lesson learned from this case study is the catalyst: the team realized that the pricing of OGV seemed to be incorrect, with its market cap/TVL ratio being much lower than that of other competitors.

Conclusion

Token migration or merger does not guarantee immediate and/or long-term positive price behavior. Therefore, ensure that the migration/merger has strong reasons and a solid foundation.

Token migration is not a one-time event. It is just the beginning. Communication, transparency, and governance proposals should not stop there. This is also why the author believes that some cases are more successful than others.

Most migrations in these five cases are not yet complete, so there is still much to monitor to understand their overall product and ecosystem progress as well as token performance; and to judge "whether this is a successful migration/merger."