The BRIGHT Union token economy
While most of the world is still trying to wrap their heads around how Bitcoin and Ethereum work, the innovators in the crypto industry are using tokens to create radically different business models. Instead of pyramid-shaped ownership, tokens make it possible for communities to partly own and control the apps that they love.
We have designed our token with exactly this principle in mind. With our native BRIGHT token, Bright Union users can have a stake and say in the development of our risk coverage platform. Ultimately, the token will enable Bright Union to become a full-fledged DAO and thus a truly community-owned protocol.
What BRIGHT can be used for
The BRIGHT token is at the heart of the Bright Union protocol. It functions as a coordination mechanism through which contributors are rewarded for adding value to the platform. In turn, BRIGHT holders can use their token to vote on important decisions of the platform and manage Bright Union’s treasury. Let’s take a closer look at these unique token utilities.
Membership: join the Union
The BRIGHT token also functions as a proof of membership of the platform and will join the Union. Members enjoy priority access to our regular products and are eligible for Bright Union’s premium services. As the protocol evolves, other membership perks can be added to reward the community.
Users who stake BRIGHT tokens can also vote on various important decisions regarding the platform. This is the feature that will ultimately transform Bright Union into a Decentralized Autonomous Organization (DAO). Aspects token holders can vote on include:
- Governance topics (where the DAO should focus on)
- Treasury fund allocation
- Parameters for the Bright Risk Indices
- Parameters for the Liquidity products
- New yield-generating products to be included
- The protocol roadmap
BRIGHT holders can lock their tokens on the platform with BRIGHT staking. This reduces the number of tokens in circulation and helps stabilize the Bright Union token economy. In return, stakers can receive rewards for helping out. Because we like to practice what we preach we will be offering embedded coverage with Bright Staking, meaning that staked BRIGHT tokens are protected from hacks and smart contract failures.
The treasury of Bright Union is a dynamic pool of capital that will be used to strengthen the economics of the platform and to accelerate the crypto risk markets. This is done by introducing some well functioning principles from real world insurance into the decentralized alternative for insurance (“coverage”). The Bright Treasury will be kickstarted with a significant part of the tokens in circulation, and will keep growing by receiving a part of the commission fees of the Bright Union aggregation modules and the other Bright Union risk products.
This treasury will be managed by rules decided on by the DAO. The Bright treasury will support a wide variety of products by providing capital: a staking pool, a liquidity pool and an investment pool. Capital that is provided to these products leaves the treasury in exchange for a fee. The staking pool is used to pay for the returns of BRIGHT staking.
The investment pool
The investment pool will primarily take positions in the crypto risk markets and will create (derivative) innovative decentralized risk products. For example the Bright Risk Indices (BRI), where the Bright Treasury will stake coverage to diversified positions in the market and will subsequently create a sliced package of covers for investment purposes by issuing tradeable EC20 tokens. The Bright Risk indexes will ensure maximum return at minimum risk for crypto investors, and will greatly boost the liquidity for the entire crypto risk markets. Bright Risk Indices are being developed as part of the ETH Global HackMoney2021 hackathon and are scheduled to go live In Q3 2021.
As an accelerator of the market for decentralized covers Bright will provide liquidity to the market. Currently the risk platforms put barriers for users to leave their staking position in order to lock their funds. For these situations Bright Union will create a liquidity pool. This can be used to create a secondary market for risk coverages, and will help stakers to leave their positions earlier.
With more reserves, the treasury can be taking positions and used to invest in products and services that strengthen the platform. This means that a bigger treasury can both be beneficial for the community, but also for the market as a whole as Bright Union is an accelerator, creating a positive reinforcement loop for the entire crypto risk markets.
110,000,000 (110 million) BRIGHT tokens will be issued. 7.7% of the tokens are reserved for the various rounds of token sales, during which the token is sold for $0.10 a piece. Seed investors received a 40% discount and private a 20% discount on this price for taking on the early risk. Another 2% is reserved for decentralized exchanges listings.
Furthermore, 25.8% is reserved for the founders, team members and advisors and are all subject to 36 months and 24 months vesting schedules.
Finally, 36.8% of the tokens are allocated to the treasury and 27.8% is reserved for the Bright Union community.
A BRIGHT future
The BRIGHT token is a versatile asset essential for the functioning of the Bright Union risk coverage platform. With the token, users can earn rewards, enjoy a premium membership, can vote on important decisions of the platform and manage the Bright Union treasury. Together, these utilities of the token turn Bright Union into a DAO, a platform that is owned and controlled by the community. By owning BRIGHT, you can benefit from the growth of the DeFi risk markets.
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