Introducing Verum Protocol, the first truly deflationary coin on Polkadot

TL;DR — Verum Protocol is deploying the first truly deflationary cryptocurrency on the Polkadot ecosystem. For every transaction of VERUM, 3% of the total coin supply will be burnt. VERUM will go live on the Moonbeam parachain in Q2, 2020.

The Problem of Token Release and Inflation

When a project releases a token onto exchanges, it usually starts with a low circulating supply. As days progress, more and more tokens get unlocked, in line with a pre-determined token release schedule. The newly unlocked tokens might be transferred to investors following the vesting schedule, paid as salary to the team running the project, or used in marketing, development or any other such activities.

Whatever the case might be, token unlock creates more supply than demand in the market, creating selling pressure and more often than not leading to negative price movement.

In some cases, projects are known to release tokens to flood the market with tokens unannounced, either as part of ‘dump and run’, or due to unscheduled changes in token release schedule. This can result in a sudden crash in token price, leading to unprecedented losses to investors.

Coin Burn and Deflation

Some projects resort to periodic coin burns, where a certain amount of the circulating supply of the coin is ‘burnt’ or permanently destroyed and removed from circulation. Leading cryptocurrency exchange Binance holds quarterly coin burns which reduce the circulating supply of their native coin BNB.

Some other projects have buyback schemes, where a certain amount of funds is used to buy back project tokens from the secondary markets and removed from circulation. This mechanism also helps in reducing the selling pressure and maintaining the token price.

Unfortunately, both coin burns and buybacks are usually centralized techniques, depending on the judgement of the team running the project. There is no involvement of smart contracts here, and no obligation on any project team to continue with token burns forever either.

The Concept of Deflationary Coins

Deflationary coins introduced a new revolutionary idea — with every transaction, some portion of the circulating supply would be removed. The amount of coins burnt might be a certain percentage of the transaction value, or a fixed amount of coins every transaction.

For example, if a deflationary coin XYZ burns 10% of each transaction value, then if you send your friend Brian 100 XYZ coins, he will only receive 90 of them and 10 will be burnt forever. If you actually want Brian to receive 100 XYZ coins, then you have to transfer 111.11 coins, out of which 11.11 will be burnt once the transaction is confirmed.

Don’t confuse this with the gas fees you pay when you send ETH; the gas fees go into the pockets of the miners, while in case of deflationary coins, the coins are destroyed forever.

There have been some experiments of deflationary currencies on the Ethereum blockchain, such as Bomb and then Nuclear Bomb. However, all such currencies involved the payment of a certain amount of ETH as gas fees to confirm the transactions, and were subjected to the long transaction confirmation times associated with the Ethereum blockchain under heavy congestion.

These issues reduced the intrinsic values of the coins as a medium of exchange itself. None of them succeeded in moving beyond the experiment stage to mainstream adoption.

Introducing VERUM

VERUM is going to be the first truly deflationary currency on the Polkadot chain. Verum is presently built on the Binance Smart Chain as a deflationary currency, and will go live on the Moonbeam/Polkadot parachain. When Moonbeam test net launches in Q2 2020, all VERUM holders will have their token swap functionality enabled to receive a 1:1 swap of Moonbeam VERUM tokens.

The deflation mechanism of VERUM is completely controlled by smart contracts, and 3% of the total VERUM supply will be burnt with every transaction. The total supply of VERUM will be 300,000. No new coins will ever be minted, making VERUM truly deflationary in nature.

Whenever a VERUM transaction occurs, the coin supply reduces which constantly keeps on removing any selling pressure. Moreover, this entire mechanism is completely controlled by smart contracts. So, once the smart contracts have been deployed, even we can’t change the terms of coin burn (not that we want to).

VERUM has been built on Binance Smart Chain (BSC), which is one of the fastest blockchains in operation today. BSC allows users extremely fast transaction speeds at very low costs, avoiding all the bottlenecks that are associated with the Ethereum blockchain.

However, after several brainstorming sessions, we decided that going forward we would be transitioning to the Polkadot blockchain. Polkadot ecosystem offers cross-chain inter-operability and enhanced security. A bustling economy of innovative projects is being developed in the Polkadot ecosystem. Deploying VERUM on Polkadot will open the true value of VERUM to all stakeholders, and also allow the other projects on Polkadot to utilize VERUM as per their needs.

Verum’s Vision

VERUM has been created by a bunch of Cryptocurrency enthusiasts from a reputed Fortune 500 company based in the US, technical backgrounds in blockchain development and cloud services. The team also consists of an ex-Wanchain developer who specializes in development and management of DEXs and Substrate web applications, and has been freelancing for several blockchain projects over the last 3 years.

In the crypto market, new hype cycles are forming continuously. Investors find it difficult to keep away from FOMO-ing into over-valued projects. Consequently, a lot of investors end up with financial losses. At Verum Protocol, we believe that the only possible solution to produce sustained growth is a deflationary currency where the supply reduces in a fixed manner.

We have created VERUM as a safe hedge against inflation. Going forward, we also plan to introduce a yield farming mechanism, such that VERUM holders would be able to provide liquidity to tokens pools and farm more tokens.

Verum’s smart contract code has been audited by our team of in-house developers and we are sure that it’s upto industry standards. However, in the spirit of decentralization, our smart contract will be formally audited by Certik by the end of February or early March. Moreover, the smart contract will be open to anyone to check and verify once it is deployed.

Verum is going to be a community based project. The team will play only a supportive role in the project once contracts are deployed and the project is listed. We want to see the community take this forward and contribute actively to the development of VERUM. We will also be working closely with local communities in the MENA region to educate them blockchain technology in general, and to spread awareness about the functionalities of VERUM.

Verum Public Sale

Since Verum is a community backed project, we’re not raising any funds from investors or VC. We’ll have a Public Sale in the month of February, where we will raise a modest amount for future development activities of VERUM.

We expect that after the Public Sale, Verum will have a fully diluted market cap (market cap if all tokens are released into the market) in the region of $100,000 to $200,000 on listing. The actual initial market cap will be even smaller, as a small percentage of the total token supply will be released at the beginning, providing ample room for the token price to appreciate in the near future. Furthermore, the reduction in VERUM supply with every single transaction should only drive the token price up.

VERUM will be listed on Pancakeswap after the completion of the sale. Locking of liquidity will be done in the first 1 hour of Pancakewap listing for a period not less than 12 months. Further re-lock will be decided after community voting.

VERUM Tokenomics

Total tokens: 300,000

Team tokens: 21,000

Public Sale: 112,500

Marketing: 15,000

Pancakeswap Liquidity: 22,500

Ecosystem rewards: 111,000

Parachain development: 11,000

The team is allocated 7% of the total supply of tokens, which will be locked for a period of 12 months. Thereafter, the team tokens will be released 1/3rd quarterly.

Verum Roadmap

The staking and rewards program will begin by the end of Q1, 2021. Over the next quarter (Q3), we will work to get VERUM listed on a couple of exchanges. We will also deploy VERUM on the Moonbeam parachain from the existing Binance Smart Chain framework. All VERUM holders will have their tokens swapped for Moonbeam VERUM tokens in a 1:1 ratio. This will make VERUM the first deflationary coin in the Polkadot ecosystem.

Stay tuned to our social channels for the latest updates of VERUM and more details about the Public Sale.

Website: www.verumprotocol.com

Twitter: https://twitter.com/verumprotocol

Telegram Channel: https://t.me/verumprotocol