This week, pax.world launched $PAXW, its proprietary utility token for the metaverse. The process of designing and launching $PAXW has provided a clear understanding of the token’s inherent purposes, enormous potential, and possible dangers.
Let’s begin at the top:
A utility token is a cryptocurrency that serves a specific purpose within a particular ecosystem. Utility tokens give holders the right to perform specific actions on a blockchain network or decentralised application – in this case, $PAXW is native to pax.world. It is a utility and governance token rolled into one – minted, stored, and kept secure on the blockchain.
One of $PAXW’s purposes is to grant the token holder a stake in the platform’s governance. Typically, governance tokens can hold the key to voting rights, a say in project direction, new partnerships, and upcoming platform features. In this regard, $PAXW plays an essential role in the decision-making process of the soon-to-be-released DAO (decentralised autonomous organisation), a governance model that pax.world strives to achieve.
In addition to its multiple functions as a means of payment, trade, and investment, cryptocurrency can also be spent or traded across a wide range of platforms and ecosystems. Many iterations of the metaverse effectively take the form of expanded social networks or video games. However, pax.world is a metaverse that serves as a functioning society that facilitates trade, commerce, culture, education, innovation, networking, and socialising.
In order to allow this virtual society to flourish and to facilitate freedom, fairness and creativity, the team must build pax.world on solid bedrock, not only in operational terms – undoubtedly important – but also in the design and deployment of its governance and in-game economy.
A token listing is crucial to this latter building block. A strong in-game economy requires a robust store of utility value, and tokens form part of that function – a means to the end of a thriving pax.world community. A metaverse is only as strong as its community, and tokenisation is a decentralised solution that enables communities to contribute to creating and governing a society (e.g. through a DAO) without the intervention of a partial third party.
In light of the above aspects of token usage applicable to pax.world, the team has decided to list the token before pax.world’s grand opening. It is to begin expanding the pax.world metaverse economy. The token has been created to serve the same benefits as a governance token and a utility token. Choosing the appropriate time to release a token requires time and effort. Some may question whether the team has put the cart before the horse by issuing a token before the public opening of pax.world.
Instead, now is the ideal time to make this announcement. And this is a result of a combination of opportunities and threats: to summarise, the release of $PAXW will enable pax.world to build communities by enabling functions such as events, experiences, and marketplaces, while also laying the foundations for a robust governance framework.
Running on the carbon-neutral Polygon (MATIC) blockchain, citizens will use $PAXW to buy land and pay for in-world services. $PAXW will act as the primary medium of exchange in the pax.world marketplace for virtual products and services, including businesses, live performances and events, advertising, training, and education, all made possible through the issuance of NFTs.
The citizens will also use $PAXW tokens in staking, earning access to exclusive rewards, including limited edition NFTs and a VIP program of talks and events. In addition, staking boosts the rewards pax.world citizens receive for their achievements, including visiting locations, completing assignments, creating content, and community engagement.
As $PAXW evolves into the fully functioning virtual society the team envisions, it will help to create individual communities and markets. However, there are several risks to be considered.
A DAO-run project such as pax.world must ensure that its users are given fair and appropriate governance privileges; however, unregulated early access to a token could allow those with greater resources, such as ‘Crypto Whales’, to utilise the model by gaining disproportionate access to the token and the decision-making power it grants, thereby transforming the virtual society into an oligarchy from the beginning. When establishing a new nation, a user would strive to avoid economic conditions in which private institutions have greater control over capital and decision-making than the government or central bank.
Another risk is that users hold onto tokens for extended periods. These supply fluctuations can affect the power and individual weight of tokens in voting rights, undermining the legitimacy of certain decisions taken by the DAO.
A higher level of regulatory uncertainty underpins these risks. Right now, the metaverse is in its ‘wild west’ era, and regulators could soon change the rules around the dissemination of tokens and their role in governing virtual societies.
It is not to say that starting a virtual economy with a utility and governance token listing is without challenges. However, in a market fraught with gimmicks, where the irresponsible approach of some entities, chiefly Meta, towards the metaverse as a concept, is damaging the reputation of the sector, credibility is vital and in short supply.
In a recent Invezz article, Alice Davies wrote: “In the recent wake of meme token crashes and failed projects like Terra and Voyager, looking for high-quality utility token projects has been high on the average crypto investor’s agenda.”
With the listing of $PAXW, the team is creating a token that will open up a whole world of functions fundamental to the continued growth and development of the pax.world community. In doing so, the team is also fusing adamantium to the backbone of this virtual world, thereby ensuring that $PAXW will carry real-world value and credibility earned at the expense of and for the benefit of the citizens of pax.world.
For more information about pax.world, please visit:
MEXC Listing: https://qrco.de/MEXCpaxworld
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