Tokenomics often make or break a crypto project. While researching DUSK, I uncovered a strikingly unusual design in its token release schedule: of the total 1 billion tokens, 500 million are already in circulation, while the remaining 500 million are set to be gradually unlocked over 36 years for stakers.
Wait—36 years? Bitcoin has existed for only 17 years. Is this extended release meant to protect long-term value, or is it a way for early investors and the team to maintain control? Let’s break it down.
Initial Allocation
DUSK’s total supply is 1 billion tokens, allocated as follows:
50% to token sales (500M)
18.1% to development (181M)
6.4% to team & advisors (64M)
The rest for marketing, ecosystem incentives, etc.
On the surface, the allocation seems reasonable—but at what price were these tokens sold? DUSK conducted an IEO in 2019 at $0.03–$0.04. Early investors are already up 50–100%, while retail buyers near the 2021 ATH of $1.09 are down 94%. The gap in returns highlights the unfair distribution.
The 36-Year Release Mechanism
The remaining 500 million tokens are to be unlocked through a “geometric decay” model, rewarding stakers. This superficially resembles Bitcoin’s halving—but unlike Bitcoin’s transparent and immutable schedule, DUSK’s release lacks detailed documentation.
Roughly, 500 million tokens over 36 years averages ~13.9 million tokens per year, though early years may release 20–30 million tokens, adding continuous selling pressure to the market. At the current price of $0.059, a 25 million token release in a year could translate to $1.47 million of potential sell pressure. In a bear market, this could trigger panic selling, harming both price stability and staker confidence.
Unlike Ethereum or BNB, which have mechanisms to reduce supply or burn tokens, DUSK continuously inflates its supply, risking chronic depreciation.
The 10% Compounding Penalty
DUSK’s Sozu staking imposes a 10% penalty for compounding, claiming it controls inflation. But compounding demonstrates user confidence in the project. Penalizing loyal users discourages growth, artificially limits staking scale, and appears to patch underlying flaws in the token model rather than genuinely protect holders.
By contrast:
Cosmos (ATOM): free compounding, stable APR (~17%)
Polkadot (DOT) & Solana (SOL): auto-reinvest staking rewards
DUSK’s penalty-driven approach creates inefficiencies—currently, 3.7 million DUSK sits idle, not contributing to network security or value creation.
High Concentration & Team Lock-Up Issues
On-chain data shows the top 10 addresses control 73.87% of circulating supply, with the largest holding 21.21%. Combined with the team’s 64 million tokens fully vested in 2022, a few actors could dump large amounts at any time. In practice, this concentration gives them disproportionate market influence and leaves retail investors vulnerable.
Comparison to Other Chains
Avalanche (AVAX): 720M supply, team tokens locked for 10 years, quarterly transparent releases, transaction burn mechanism
Secret Network (SCRT): 96% of total supply in circulation, minimal future sell pressure, more price stability
DUSK, with 50% supply unlocked and 36 years of inflationary releases, faces far higher long-term risk.
Sustainable Staking APR?
DUSK’s advertised 28% APR relies heavily on new token inflation rather than transaction fees or ecosystem activity. With low on-chain activity (~$90k daily volume), the APR may fall as staked DUSK rises, undermining incentives.
36-Year Timeline: Unrealistic in Practice
The crypto industry evolves rapidly; new technologies may replace existing paradigms every 3–5 years. DUSK’s 36-year schedule assumes the project remains relevant decades into the future—an uncertain bet. Large holders could also manipulate governance to adjust release schedules, further undermining retail investors.
Conclusion
DUSK’s tokenomics appear designed to benefit early investors and the team, not long-term holders:
36-year release schedule creates chronic inflation
Compounding penalties discourage loyal users
High concentration of holdings amplifies market risk
Team tokens are freely circulating
For long-term investors, alternative projects with transparent, controlled supply mechanisms like SCRT or upcoming Aztec mainnet may offer more sustainable opportunities.
Unless DUSK can demonstrate real ecosystem demand and adoption within the next few years, its token economics may continue to erode investor value.
@Dusk $DUSK #dusk