Value Capture Mechanism

Dynamic Minting

In the Ecosphere network, token minting incentivizes supplier participation. Unlike static minting models which define a fixed minting schedule before launching the economy, the dynamic minting model is adaptive and state-dependent such that the amount of tokens to be minted is determined by the growth in the supply network’s value. A dynamic minting model ensures that the token’s circulating supply is perpetually commensurate with the actual value generated by supply-side network activities.

Climate Nodes, acting as primary suppliers within the network, are rewarded with newly minted tokens in each epoch. The quantity of tokens received is directly proportional to the volume of data they contribute to the climate forecasting models.

When a supplier earns a reward, new tokens are minted in accordance to the respective reward function, and disbursed to the supplier. The circulating supply increases by this amount.

When more Climate Nodes are onboarded to the Ecosphere network , this represents a growth in the supply side of the network. A growth in the supply side is always accompanied with a equivalent volume of minting.

Dynamic Burning

A burning policy is employed so as to capture the value generated due to Ecosphere network demand and product usage. Mechanistically, it drives deflation of the $PRIME token and increases its unit value in relation to the demand. Note that the inflationary dynamics still remain dominant, so the system overall remains inflationary.

Revenue earned from climate data subscriptions will be used to buy back $PRIME tokens from the secondary market and those tokens will be burned.