In order to run a successful business, it’s vital to build a solid team with a clearly defined set of roles. A CEO wouldn’t instruct their head of software development to start coming up with marketing strategies, just like they wouldn’t expect their head of marketing to start programming. Each team member contributes their own set of skills in their area of expertise, and that’s ideally where most of their attention should be focused.

When we were designing Varanida’s token economy, we used the same logic, and took a step back to examine the practicality of having a single token serve as both a ‘store of value’ and a ‘medium of exchange’.

Store of Value Tokens are not actively used within a network. Rather, these tokens are often purchased by investors who believe in the project’s model, and prefer to hold these tokens with the belief that their value will increase over time. Often, the increase in value of these tokens correlates with an increase in network usage, but some tokens have additional incentives to hold them long term, such as staking and collateralizing in return for passive payments.

Medium of Exchange Tokens are used within an ecosystem to complete transactions, such as buying or selling goods and services. Ideally, this type of token should have a stable value and experience minimal price inflation, so that users are incentivized to spend the tokens within the network, rather than hold them long term. Users that spend these tokens are actively participating in the network, increasing its velocity and helping contribute to its success.

We realized that having one token serve both of these functions does not make sense for the long term success of Varanida. Therefore, we decided the best option was to offer both a store of value token for those looking to profit from maintaining the network, as well as a medium of exchange token for those looking to complete transactions within the network.

First, The VAD ERC-20 Tokens

In an effort to facilitate transactions between users, advertisers, and publishers during the initial stages of the network, Varanida will operate using a single ERC-20 token, the VAD (Verified Ad) token. Participants in our prototype phase and in our Token Generation Event will receive VAD tokens, which will be distributed by end of Q3 2018. VAD tokens can also be used by advertisers and publishers during this stage to build and promote their own applications on the Varanida network, and by users to access specific content, unlock premium features, use applications etc.

Once we launch our own blockchain in Q2 of 2019, VAD will be separated into two unique tokens, a VADm Master Token that will serve as a store of value, and a VADu Utility Token that will serve as a medium of exchange.

When this transition takes place, VAD owners will receive VADm, airdropped on a 1:1 ratio.

At the same time, we will determine the correct supply of VADu that the network will require to operate effectively, and will create the first VADu by using the Varanida Team’s VADm tokens as collateral. Other VADm owners will also be able to create VADu if the price of VADu exceeds the target price, meaning the demand is stronger than we expected, or if the network requires more VADu than we can supply using our own VADm.

VADm and VADu tokens have different underlying protocols, but will work in tandem to contribute to the Varanida ecosystem in a very special way.

The VADm Master Token

VADm tokens will serve as ‘Store of Value’ tokens with a fixed supply, and the underlying protocol incentivizes owners to hold the token over a longer period of time.

Master nodes of the Varanida network will be required to stake VADm tokens to run the real time bidding and verification nodes. However, without running a master node, one can still profit by collateralizing their VADm to create VADu tokens.

In both cases, the token immobilization will be rewarded with VADu that is collected from fees for the use of the advertising services (service fees through the service nodes) or for the use of VADu (transaction fees for collateral), and with VADm when VADm transactions are verified.

The VADu Utility Token

VADu tokens will serve as ‘Medium of Exchange’ tokens, with a stabilized, slightly inflationary value. These utility tokens will be used to complete all of the transactions on the Varanida network, making it the sole digital currency that advertisers, publishers, and users will use to interact with the network.

Owners of VADm will be able to collateralize their VADm tokens in order to create VADu tokens, and redeem VADu tokens that have been paid by users as transaction fees. Not only does this bring a stable price to VADu, it also brings an incentive for users to over-collateralize their VADm to keep the network consistent, which will further reduce VADm velocity.

We’d rather be safe than sorry, and through over-collateralization, we are making sure that the value of escrowed VADm is greater than the value of VADu in circulation, keeping us on the safe side in case of excess price volatility.

Here is a visual representation of How It Works

More than anything else, we want to GROW our network

With the launch of any new blockchain project, a common question gets asked: “What’s the purpose of having a token?”

Usually, an obscure or opaque answer to this question is given, which is a strong indicator that this project’s team is more interested in the funding that the token provides, instead of what the token actually does. This is the case for many ‘Medium of Exchange’ tokens.

On the other hand, sometimes the project’s team fails to clearly identify and describe the mechanism that allows their tokens to gain value and eventually provide an ROI to participants. This is the case for many ‘Storage of Value’ tokens.

At Varanida, we designed our network to provide significant benefits to everyone, including users, publishers, advertisers, investors, and developers. To satisfy the needs of all parties, we formulated a dual token structure where VADm and VADu work together to strengthen the network. Most importantly, we offer full transparency when describing exactly how VADm and VADu will be utilized on the network.

No obscurity or opacity, just pure and total transparency.

We certainly want people to participate in our token sale, but we also want to make it clear that our tokens will play a pivotal role within our network, and we encourage stakeholders to actually use them. As noted above, we will be providing several incentives specifically for people to use their tokens within the ecosystem.

We truly believe in the potential of Varanida, and we are strongly committed to paving the way to a better Internet. The more people that use our network, the better it performs for everyone.

If you would like to find out more about our dual token structure, including the technical details of exactly how it will work, please download our White Paper. If you’re interested in learning more about Varanida and our goal of cleaning up the Internet, please join us on our journey:

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