Hayden Adams, the creator of the Uniswap Protocol, recently shared what he considers to be the eight commandments of ethical token distribution. The guidelines shared via an X post are aimed at ensuring that the foundational principles of layer-zero protocols promote a fair and transparent ecosystem.
Avoiding Speculation and Manipulation
Adams emphasized he shared these insights in response to the ongoing discourse about token distribution practices, highlighting common pitfalls and ethical considerations.Â
According to the Uniswap creator, tokens should represent real value and not be confused with meaningless points. This will prevent any form of ambiguity or misleading holders about the actual value and utility of their token.
Adams cautions against teasing, creating hype without providing concrete information or manipulating community sentiment. He maintains that speculation around token distribution is bad practice. Additionally, he criticizes the trend of low float tokens, labeling them as malicious. Adam admonishes projects to ensure enough tokens are publicly distributed to allow for real price discovery through Decentralized Exchanges (DEX).
Not aimed at any specific project, but have seen a ton of discourse recently on the topic so figured I’d share my take on good token distributions:
1) tokens, not points
2) don’t farm the farmers – teasing and creating ambiguity around a token distribution to grow your numbers…
— Hayden Adams 🦄 (@haydenzadams) May 4, 2024
The practice of creating an excessively high token supply to attract users with a bias toward lower unit prices is also considered bad behavior by Adam. He urged projects to avoid tactics that exploit investors’ tendencies to prefer lower-priced tokens, which can lead to skewed valuations.
Fair and Transparent Token Distribution
Adams advocates for a generous approach to token distribution by projects to members of their community. According to the inventor, the attitude of engaging influencers and marketing firms to hype price trends and promote token prices, suggests a get-rich-quick mentality as opposed to building real value within the ecosystem.
To prevent the confusion and mistrust associated with the complexity of tokenomics, Adams advises that simple token distribution model. He also advocated keeping it simple and straightforward to maintain clarity and promote trust within the community.
Finally, Adams emphasizes the importance of thoroughly thinking through decisions and being able to defend them with confidence. In reaction to the post-show the majority of users agree, emphasizing the community is greater than everything.
