Finance and Tokenomics

Funds, tokenomics and LizCoin ($LIZ)

What are the Pre-seed and Seed funds going to be used for?

The pre-seed raise is intended to fund the startups on the community and partnership pillars, expanding the team and releasing new products. The investors are specifically investing in this value proposition that 500k is going towards improving the Ethlizards larger ecosystem.

When we do the Seed raise, that includes supporting the Portfolio Sub-DAO operations as well. This all works symbiotically - the more investments we make in top class projects, the more new partners we make, the more value comes into the Portfolio Sub-DAO alongside the other two sub-DAOs which creates a flywheel effect to continue scaling out support and development in all 3 sub-DAOs.

Why Token?

We need to be able to increase product adoption and community size to scale with our partners - especially gaming studios. Similar to Illuvium benefitting by leveraging Illuvials and ILV tokens separately to create governance structures, we will use a trio of the portfolio NFTs (currently available), gamified NFTs (new), and tokens (new) to govern and scale our different sub-DAOs. There will be links between them where appropriate to ensure the overall structure is symbiotic in nature.

Additionally, the current project scope and team size is solid for the long-term investment structure in place today. But by performing a raise today, we can dramatically scale our product offerings as many of our partner projects are launching in late 2023 and into 2024.

By using an improved version of the Illuvium strategy - yield farming and Rev Dis but adding active community and participation requirements - we have a sustainable and regulatory compliant structure.

Why would we want $LIZ?

There is a lot of value being driven back to the token through the tokenomics model. This works through 4 main inputs driving long-term value to $LIZ. We were meticulous in crafting the use cases of $LIZ with a host of partners and advisors.

  1. Gaming and gamification utility (like in Battle in the Beyond).

  2. Participation rewards via yield and revenue sharing active staking models.

  3. Cross-partner IP payments.

  4. Partnership value through the Web3 Gaming Alliance.

We’ve set up this ecosystem to have redundancy in case one pillar lags behind in timing or delivery, that there are other pillars offering robust support and stability.

What is LizCoin's ($LIZ) Utility?

Participation Rewards

The $LIZ token will allow stakers who actively participate in the Ethlizards community to receive a share of the success of the project. This is achieved through yield farming during the first 3 years, which then transitions to revenue distributions in year 3 and onward. Participation can take many forms including governance, QA testing, content creation, partner support so active involvement is essential but rewards will be meaningful.

Community and Ecosystem Engagement

The $LIZ token allows Lizard holders to participate in the governance and decision-making of the project which further decentralizes the DAO. Token holders can vote on proposals and shape the direction of the project, including allocated seats for partner projects on the Partnership sub-DAO.

Transactional Utility

$LIZ will be exclusively usable to some items, game passes and exclusive merchandise and access to events that are only available to Liz holders. This adds value to the token and incentivizes members to hold it.

Partner Staking

$LIZ will be necessary for members of the Web3 Gaming Alliance to fully participate. Membership includes access to the entirety of the ecosystem along with participation of Ethlizards Partnership sub-DAO governance.

We are integrating LizCoin to be a prominent part of the ecosystem. Considering that there are different reasons for each group to hold/use/stake LizCoin - partners, investors, builders and gamers, we expect this to have a combined impact on buy pressure.

What is the difference between yield farming and revenue distribution?

Yield farming results in the distribution of additional $LIZ to actively participating $LIZ stakers. Revenue distribution will pay a share of ETH or USDC payments in future revenue generation from products and services launched by Lizard DAO (details still TBD).

How much % of revenue goes to $LIZ Rev Dis?

The percentage of revenue distribution has not yet been determined. It will be determined by a future governance proposal. As it is not planned to be implemented until 2+ years after token launch, we intend to remain flexible and responsive to the community as the project evolves. (Revenue distribution begins around the same time that yield farming ends). It will be the question at that time of how much the DAO wants to commit to further building vs. sharing with the participating community members.

How can holders participate in the $LIZ Token sale?

  • Pre-seed sale with allocation available to holders will be via decentralized Aelin Pool.

  • Seed sale with allocation available to holders (method yet to be announced).

Is KYC required?

No, we will use the decentralized Aelin pool structure for the raises so there would be no KYC requirements, as the raise is being performed by the DAO.

Is $LIZ going to be launched on ETH Mainnet or an L2?

We are leaning towards ETH Mainnet but not 100% confirmed.

How were the tokenomics percentages selected?

The foundation laid by the current community should be recognized in the valuation and sharing of tokens launched. Likewise, the value provided by the pre-seed and seed investors should be recognized as well. Finding just the right balance between current community, investors, team, and future community is a difficult one. To achieve this, we consulted with numerous tokenomics specialists who have designed successful protocols.

Providing 7.5% of the token to existing holders allows a strong starting point that is generally higher on a per NFT basis than similar situated projects. Note that we actually considered holder airdrop at 10% but our tokenomics experts advised us that we were giving away TOO MUCH value to holders upfront which would cause issues in token price stability and depress new buyers from entering our ecosystem. Increasing airdrop % comes at the risk of token price stability and favors an immediate benefit to current holders versus encouraging community participation via staking among long-term holders. We’re pretty locked in on the Pre-Seed, Seed, Team and Treasury amounts based on the raise activities.

Current token value flows directly to holders through not just the Airdrop but also a substantial 30% of preseed allocations and a further allocation during the seed round as well. Roughly 80%+ of yield farming will go to holders and the public sale since team and pre-seed/seed investors are locked for a large portion of the yield period. Additional value flowing from Elemental Lizards and other elements not yet announced are intended to benefit community holders also. Our models show that approximately 25% of the tokens will be going directly to current holders via the Airdrop (7.5%), Pre-Seed (3%), Seed (2%), in-game rewards (3%) and Yield Farming (9%). This is not even counting stacking ecosystem benefits for additional $LIZ yield, NFTs and other rewards. If you look at the total value package that holders get it is actually incredibly high.

Also consider that at time of seed raise then the total value of the ecosystem 3-5x (treasury goes from 500k > 5.5M) that it would be common to expect the holder’s existing assets to reflect this change, increasing the value of holder NFTs as well.

At the end, if each group of individuals feels like the arrangement is solid but wishes that they had a larger allocation then the structure is probably in a good place.

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