Sonic SVM Chain on Solana Enhances Token Burn Mechanism for Increased Liquidity
Sonic SVM chain, a Solana-based blockchain project, has announced a significant update to its tokenomics strategy aimed at boosting buying pressure on its native token, SONIC, and enhancing liquidity within its ecosystem. The new burn mechanism, revealed in a recent press release, will see 50% of all transaction fees allocated towards purchasing SONIC tokens on the open market, marking a departure from the previous practice of sending tokens to a burn address.
Functioning as a layer 2 network on the Solana Virtual Machine, Sonic SVM is geared towards monetizing user attention within applications. The revamped token burn model is expected to directly impact SONIC’s price dynamics, providing more immediate benefits to token holders. Chris Zhu, CEO of Sonic SVM, emphasized the strategic significance of this shift in approach, highlighting the dual purpose of creating demand while establishing protocol-owned liquidity to support the project’s expanding ecosystem of games and applications.
“In redesigning our token burn mechanism, we are laying the groundwork for long-term token value by fostering strategic demand and bolstering liquidity. This approach not only benefits our growing community of token holders but also strengthens our network’s foundation for sustained growth,” stated Chris Zhu.
In addition to the token burn update, Sonic SVM will leverage transaction fees to enhance liquidity within its network. A portion of these fees, specifically those denominated in Solana tokens, will be staked on the Solana mainnet to generate staking rewards. These rewards will be distributed to users holding vested SONIC tokens who actively participate in liquidity pools for Sonic’s SVM chain. Alan Zhu, co-founder and chief product officer at Sonic, emphasized the scalability of this liquidity-boosting mechanism, aligning it with the network’s increasing usage.
“As we expand our infrastructure to accommodate a broader user base across our gaming and social platforms, our liquidity enhancement strategy ensures that our token economy grows alongside network utilization. The synergy between network activity, buy pressure, and liquidity depth will fortify our ecosystem and drive sustained value creation,” noted Alan Zhu.
The implementation of these innovative tokenomics updates underscores Sonic SVM’s commitment to fostering a robust and dynamic ecosystem on the Solana blockchain, positioning itself as a frontrunner in the realm of decentralized applications and user-centric platforms.