The Many Positive Feedback Loops That Will Fuel Injective’s Incredible Tokenomics

Injective is far more than just a DEX it will be a thriving ecosystem centred around its exchange protocol and the INJ token, fuelling incredible positive feedback loops. The below article is how I see it playing out:

The Injective Hub will provide a seamless one stop shop for a vast amount of use cases whether it be trading spot, synthetics, NFT marketplace, lending platforms, insurance platforms, gaming elements and more. If they are able to make the UX of the Injective Hub as seamless as possible so that it is similar to depositing funds to a centralised exchange (abstracting the way that they are actually using a bridge to another blockchain) whilst offering CEX like performance with a capital efficient order book, but with the security of DEXs, the ability to list and trade any asset without having to pay extortionate fees / wait years for them to list, no gas fees and an entire ecosystem built around it, then it’s going to see exponential growth.

Injective has the potential for incredible amount of positive feedback loops all resulting in more INJ being burned and benefiting the entire ecosystem. Whilst it provides a DEX that can trade any market, it also enables other exchanges to build on top using a model similar to Binance Cloud, where they can white label the exchange but share the same back end / liquidity. Relayers are incentivised to drive traffic to the exchange through receiving 40% of the trading fees of the traffic they generate, whilst 60% of the trading fees across every exchange is used to buy INJ from the market and burn it through a biweekly auction mechanism.

DAO Relayers — Use 40% of the fees to buy and burn to add incredible utility to your favourite token

More growth > More trading fees used to buy and burn their token > Increased awareness and more projects wanting to participate and run a relayer for their token as well > More growth, and so on as the positive feedback loop continues with more and more INJ being burned, whilst at the same time creating further decentralisation with more relayers.

Possible Algorithmic Stablecoin that burns INJ similar to Terra’s UST

You can see more comparisons with Terra (this was before potential stablecoin on Injective as well) in this article

Injective Launch Pad

Potentially Massive Incentives Program to drive growth and kick start all the positive feedback loops

Why use Ethereum DEXs when you can trade on Injective and back to Ethereum for less?

Rewards and Liquidity Mining

This creates more volume for the DEX / ecosystem > More INJ burned and higher INJ price. As the price per INJ increases then that initial $100 Million announcement actually needs far fewer INJ leaving even more for future growth incentives.

Who is going to want to use the likes of Uniswap when its far cheaper to bridge to Injective, use the high performance DEX with no gas fees and then move back if required (with the Injective Hub UX abstracting away the Injective Chain and make it appear like sending to Binance to trade)?

Avoid the ridiculous 1–2 week withdrawal times with DEXs on Layer 2 Optimistic Rollups

Trading competitions

Potential Lottery System

Potential NFT rewards for trading on the DEX

Even greater scalability

There’s so many possibilities and positive feedback loops all feeding into one another for the potential for exponential growth. It’s far more than just another DEX and the tokenomics are incredible.

For more details on why Injective is an incredible investment opportunity see this article

and for more information on how the Buy back and Burn mechanism will work, see this article

DLT Enthusiast and Writer. Interoperability is key for DLT to achieve its true potential. Avalanche $AVAX, Injective Protocol $INJ and Quant $QNT