Solana-killer blockchain Aptos project gets off to a rocky start after launch, token crash

Aptos Labs, a startup founded by employees who built the blockchain behind Meta Platform Inc.’s ill-fated Diem, recently announced its “tokenomics” model amid a rocky mainnet launch that has been slower than expected.

The platform raised $200 million in March, backed by Andreessen Horowitz, Coinbase Ventures, FTX Ventures, Multicoin Capital and other major crypto venture capital firms. The goal of the blockchain was to build a highly scalable, secure network capable of massive throughput that could surpass other chains such as Solana, by scaling to a high transaction throughput.

Before the mainnet launch, Aptos boasted that it was capable of approximately 130,000 transactions per second, but during the launch on Monday, it was reported by Paradigm Engineer #420 on Twitter that the blockchain was capable of less than seven transactions per second – less than the bitcoin network.

“Aptos is broken,” wrote Paradigm Engineer. “Aptos currently has a lower TPS than Bitcoin and a majority of tokens are either staked or ready to be dumped on retail investors. Aptos promises 100k TPS in its final version. However, the current TPS is somewhere around 4 transactions per second.” “

Shortly after the launch, Aptos co-founder Mo Shaikh tweeted that it was exciting to finally launch the blockchain, but the rocky start and low TPS were a result of the network being underutilized and this was only from growing pains.

“Acknowledged it could have gone better,” Shaikh wrote. “Building a decentralized protocol from scratch is tough! Aptos is lucky to have a fantastic community that is constantly evolving together.”

According to Shaikh, the current TPS is not representative of network capacity. Rather, it is the network that idles before projects come online. It is expected to increase as more projects are added.

Apto’s ‘tokenomics’ model revealed

When it first launched, the community panned Aptos for having an opaque token economy structure. That means no one knew how its internal tokens, the Aptos token, or APT, were going to be distributed among investors, developers and the community.

At its mainnet launch on Monday, the company finally revealed its distribution, unlocking the APT token for trading, along with a airdrop of 20 million tokens on Tuesday. An “airdrop” is basically a payment of tokens to a number of users directly into their wallets to put a number of tokens into an ecosystem to jump start the economy.

“The Aptos Foundation has provided early network participants with APT tokens,” the company wrote. “If you are eligible to claim, you will receive an email from [email protected] in the next few hours.”

Blockchain projects primarily use tokens for three purposes: to finance the project by selling the token to raise capital, to use tokens to reward developers and creators for participating in the ecosystem, and as a way for the community to pay for using services blockchain.

The initial supply of APT tokens during Monday’s launch was reported to be 1 billion. According to the distribution, 510 million will go to community members, 190 million will go to the core developers and the rest will go to the Aptos Foundation and private investors.

According to Shaikh, many of the tokens, including those assigned to the community, have been staked on the origin of the blockchain. Staking essentially locks tokens to secure a network against potential attacks and produces additional tokens as a reward, which is 7% per year, unlocked every 30 days for token holders.

The fact that Aptos didn’t reveal its token model until right before the mainnet launch didn’t sit well with the community. Twitter user Aylo noted“Aptos raised to a $2 billion valuation and failed to make its financial information available at launch. There is no way this was an oversight. This was intentional.”

The disclosure of the Aptos token structure and airdrop also did not go down well with the market. As of shortly after, values ​​fell nearly 50% to trade at $7.27 today from $13.73 at launch, according to price aggregator CoinGecko.

Photo: Aptos Labs