Tokenomics

The Sonic Name Service (SNS) tokenomics model is designed to ensure long-term sustainability, community engagement, and fair distribution of the SNS tokens. Below is a breakdown of the key components of the SNS token distribution and its utility within the ecosystem.

1. Total Supply

The total supply of SNS tokens is 100 million (100M). Importantly, the SNS token supply will never exceed this amount, ensuring a controlled and deflationary supply model.

2. Token Allocation

The distribution of SNS tokens is structured to support the growth and development of the SNS platform while incentivizing participation from both developers and the community. The allocation is as follows:

• 50% – Burn to Mint Distribution: Half of the total SNS supply will be distributed through the burn-to-mint mechanism, rewarding users who participate by burning their WIGO tokens in exchange for SNS.

• 25% – Developer Allocation: A quarter of the total supply is reserved for the development team, ensuring long-term commitment and project sustainability.

• 15% – Ecosystem Incentives: These tokens will be used to incentivize participation in the ecosystem, such as rewarding users for contributing to the platform or helping to grow the SNS user base.

• 10% – DAO: A portion of the tokens is reserved for the Decentralized Autonomous Organization (DAO), which will allow the community to participate in governance decisions.

3. Staking and Protocol Fees

SNS stakers will have the opportunity to earn rewards from a portion of the protocol fees. By staking SNS tokens, users will receive a share of the fees generated within the SNS platform, providing an ongoing incentive for active participation.

4. Burning Mechanism: De-Mint Function

In addition to the burn-to-mint mechanism, SNS has a de-mint function. A portion of the protocol fees collected will be de-minted, permanently reducing the circulating supply of SNS tokens. This feature is designed to maintain a healthy token economy by keeping inflation in check and adding deflationary pressure to the token supply over time.

5. Utility of the SNS Token

The SNS token has several key utilities within the ecosystem, providing ongoing value for holders:

• Staking: SNS token holders can stake their tokens to earn rewards from protocol fees, offering a passive income opportunity for long-term holders.

• Governance (DAO): SNS will introduce a decentralized governance model, allowing token holders to vote on important platform upgrades, policy changes, and community-driven initiatives, ensuring that the project remains decentralized and community-led.

• Incentives for Developers and Ecosystem Growth: A portion of SNS tokens will be allocated to incentivize developers who integrate the SNS protocol into their projects, as well as to foster ecosystem growth through partnerships and collaborations.

• Protocol Fee Reductions: Holders of SNS tokens may also benefit from discounts on platform-related fees, further encouraging token retention and usage within the ecosystem.

Note: SNS tokens will not be used for domain registration. Domain registration on the Sonic Name Service will be paid with S tokens, the native token of the Sonic blockchain.