In this article, we’ll present a general overview of the distribution of the initial supply of LOCKS tokens, and its relation to the unique mechanics of the Goldiswap AMM.

To start with, it’s important to recap a couple of key features of how LOCKS trades on Goldiswap. First, there is no fixed supply of LOCKS. LOCKS tokens are minted when the user buys, and burned when the user sells. So the supply is completely elastic. It expands when there is overall positive buying pressure and contracts when there is positive overall selling pressure.

Secondly, there are two liquidity pools: the floor supporting liquidity pool (FSL) and the price supporting liquidity pool (PSL). The FSL supports the `floor price’ of LOCKS, which can never decrease over time because users can only ever take the current floor price out of the FSL when they sell, and always have to pay the current floor price into the FSL when they buy. The PSL supports the actual market price of LOCKS, i.e. the premium that LOCKS trades at above the floor price. Because the floor price can never decrease, all users can always borrow the floor price of their tokens interest free and without risk of liquidation, and as the floor price increases, so does the amount they are able to borrow. Of course, users need to fully repay these loans before they are able so sell any LOCKS tokens. Because the user is only borrowing their own proportional share of the FSL, their loan has no effect on the liquidity behind anyone else’s tokens, ever.

The initial supply of LOCKS tokens will be 190,000,000 LOCKS tokens. Of these,

(i) 34 million tokens are assigned to the team. These tokens are permanently staked and locked, meaning that they can never be sold.

(ii) 156 million tokens are assigned to seed investors. These tokens are locked and staked and unlock linearly over 12 months, beginning three months after tge.

The initial liquidity values of $LOCKS on Goldiswap will be FSL = 1.14m HONEY, PSL = 0.4m HONEY, with all of this initial liquidity coming from the funds raised by the seed round. The starting floor price is 0.006, the starting market price is 0.01879 and the starting total market cap of LOCKS is ~3.5m HONEY.

The smart contracts will be initialized so that both the team and the seed investors borrow the full starting floor price (funded entirely by the floor supporting liquidity raised from the seed round) of their tokens. Of course, seed investors would need to fully repay these loans before selling any tokens, and the team can never sell their tokens. From TGE, all users will always be able to borrow the floor price of their tokens in the same way, as explained above.

This design has the major advantage that seed investors and the team can access a meaningful portion of the liquidity backing their tokens via loans without ever selling or impacting the market price of LOCKS (indeed, the team can never sell any LOCKS tokens). This is a stark contrast to traditional raise structures, where seed investors and team members can only realise a return on their investment by selling tokens, thereby directly impacting the market price. Note also that there are no plans for any further investment rounds prior to launch.

The design also feeds into a more general vision whereby LOCKS holders can remain long term active participants in Goldilocks DAO whilst still being able to access part of the liquidity of their tokens at any time without exposing themselves to third party lenders, interest payments or liquidations risk, and without affecting the market or floor price of the token. Goldilocks has already created three custom defi protocols tailored specifically for Berachain, namely Goldiswap, Goldilend and Goldivaults, and LOCKS holders are able to participate in the decentralised governance of all three products, in addition to all future Goldilocks DAO creations.

TLDR: aligned incentives for long term participation, beras in control.

In this article, we’ll present a general overview of the distribution of the initial supply of LOCKS tokens, and its relation to the unique mechanics of the Goldiswap AMM.

To start with, it’s important to recap a couple of key features of how LOCKS trades on Goldiswap. First, there is no fixed supply of LOCKS. LOCKS tokens are minted when the user buys, and burned when the user sells. So the supply is completely elastic. It expands when there is overall positive buying pressure and contracts when there is positive overall selling pressure.

Secondly, there are two liquidity pools: the floor supporting liquidity pool (FSL) and the price supporting liquidity pool (PSL). The FSL supports the `floor price’ of LOCKS, which can never decrease over time because users can only ever take the current floor price out of the FSL when they sell, and always have to pay the current floor price into the FSL when they buy. The PSL supports the actual market price of LOCKS, i.e. the premium that LOCKS trades at above the floor price. Because the floor price can never decrease, all users can always borrow the floor price of their tokens interest free and without risk of liquidation, and as the floor price increases, so does the amount they are able to borrow. Of course, users need to fully repay these loans before they are able so sell any LOCKS tokens. Because the user is only borrowing their own proportional share of the FSL, their loan has no effect on the liquidity behind anyone else’s tokens, ever.

The initial supply of LOCKS tokens will be 190,000,000 LOCKS tokens. Of these,

(i) 34 million tokens are assigned to the team. These tokens are permanently staked and locked, meaning that they can never be sold.

(ii) 156 million tokens are assigned to seed investors. These tokens are locked and staked and unlock linearly over 12 months, beginning three months after tge.

The initial liquidity values of $LOCKS on Goldiswap will be FSL = 1.14m HONEY, PSL = 0.4m HONEY, with all of this initial liquidity coming from the funds raised by the seed round. The starting floor price is 0.006, the starting market price is 0.01879 and the starting total market cap of LOCKS is ~3.5m HONEY.

The smart contracts will be initialized so that both the team and the seed investors borrow the full starting floor price (funded entirely by the floor supporting liquidity raised from the seed round) of their tokens. Of course, seed investors would need to fully repay these loans before selling any tokens, and the team can never sell their tokens. From TGE, all users will always be able to borrow the floor price of their tokens in the same way, as explained above.

This design has the major advantage that seed investors and the team can access a meaningful portion of the liquidity backing their tokens via loans without ever selling or impacting the market price of LOCKS (indeed, the team can never sell any LOCKS tokens). This is a stark contrast to traditional raise structures, where seed investors and team members can only realise a return on their investment by selling tokens, thereby directly impacting the market price. Note also that there are no plans for any further investment rounds prior to launch.

The design also feeds into a more general vision whereby LOCKS holders can remain long term active participants in Goldilocks DAO whilst still being able to access part of the liquidity of their tokens at any time without exposing themselves to third party lenders, interest payments or liquidations risk, and without affecting the market or floor price of the token. Goldilocks has already created three custom defi protocols tailored specifically for Berachain, namely Goldiswap, Goldilend and Goldivaults, and LOCKS holders are able to participate in the decentralised governance of all three products, in addition to all future Goldilocks DAO creations.

TLDR: aligned incentives for long term participation, beras in control.