NEC tokens were first distributed to traders in 2017 as a reward for trading on the Ethfinex exchange, which as mentioned above – has since evolved to DeversiFi.
“We want to give our most loyal traders a higher stake in the long term success of our exchange. This means we will be holding a significant token burning event, where we will essentially burn between 40 and 50 percent of the total NEC tokens, equivalent to USD $26 million worth of tokens.”
“There were many projects that introduced their own token in order to raise capital and have since failed. We decided to do things differently, and introduced a token that was earned by using the exchange. As the wider crypto market has fallen since 2017, we have listened to our traders and have completely re-engineered the NEC token by slashing its supply and pledging an ever-increasing amount of exchange revenue to NEC token holders.”
– Will Harborne, Founder and CEO of DeversiFi
DeversiFi will be burning 400m out of the 500m tokens that it currently holds, as well as burning NEC tokens that were earned, but unclaimed, by traders of the old Ethfinex exchange.
They are also pledging up to 45 percent of exchange revenues, to buy-back and burn circulating NEC tokens, as well as offer traders trading fee discounts for holding NEC in their private wallets.
No more NEC will be minted as it will move to the new deflationary model, this will give DeversiFi traders more incentive to hold NEC and ensure the continued growth of the exchange.
DeversiFi will also launch a Decentralised Autonomous Organisation, (DAO), funded with approximately USD $3.5 million worth of ETH derived from Ethfinex exchange fees over the past 18 months.
“The NEC DAO is going to be an incredible experiment. By giving NEC real utility in the form of huge buy-backs and trading fee discounts, we hope that NEC holders will use the DAO to fuel the growth of the DeversiFI exchange. However it will be completely up to NEC holders what they do with the $3.5M USD of ETH under their control,” said Harborne.
NEC holders will be encouraged to stake their NEC into the NEC DAO when the DAO launches within the next few weeks. NEC holders will be able to earn a greater degree of voting power in the DAO by staking their NEC tokens for longer durations.