Recently, I saw an article on Rhythm titled "Pure.cash Revolutionizes Token Economics: Airdropping 100% of Tokens to the Community at One Time and Continuously Destroying Them". I found it very interesting, so I will put aside the analysis of the popular Token 2049 - Web3 mobile track, and write about Pure.cash first.
Because Web3 phones require us to spend money to buy them, and then wait for a long time before they are shipped. Pure.cash has just started public testing, and the project directly took out 100% of the tokens and distributed them all to the community, which reminds me of ZKfair in January - fair launch. At the same time, Pure.cash is a decentralized version of Ethena. Ethena had a very large pattern in the first round of airdrops in March, and many people made a lot of money.
So let’s take a look at what Pure.cash is all about. This article is divided into the following parts:
What problems does Pure .cash want to solve in the industry?
Pure .cash core mechanism
Pure.cash Token Economics
Pure .cash Airdrop Tutorial
When reading, readers do not need to follow the order in which the articles are arranged. They can just read according to their needs.
1. What problems does Pure.cash want to solve in the industry?
This section is a review of the article on Rhythm titled "Pure .cash Innovates Token Economics: Airdropping 100% of Tokens to the Community at One Time and Continuously Destroying Them". I put it in the first place mainly because I think the article's views on the current market environment are more intuitive.
(I) The harm of VC coins
In 2024, the cryptocurrency circle got rid of the two-year bear market. The price of BTC continued to rise and returned to its previous historical high, but altcoins have been falling, and even ETH has been performing mediocrely, so this phenomenon is called "the worst bull market in history."
In this "worst bull market ever", the most complained about are VC coins. The article "Pure.cash Innovates Token Economics: Airdropping 100% of Tokens to the Community at One Time and Continuously Destroying Them" puts it bluntly: Venture capitalists see Web3 as a market for making huge profits, which has led to a large influx of capital, but has never brought revolutionary innovation and contribution to the industry. The currency circle is just their cash machine, which draws blood through endless token release. The manifestation is: low release and high FDV.
The industry has now entered a stage where project owners and VCs can easily make huge profits just by selling tokens. No one has the patience to pursue real innovation. This is commonly known as "everyone is cutting leeks from top to bottom." This is a very dangerous signal that will make the industry unsustainable.
Pure .cash combines BTC, a truly decentralized network, with an open and fair model for everyone, allowing equal participation. It also raises a soul-searching question:
If Satoshi had pre-allocated 20% of Bitcoin to himself, 20% to the foundation, and another 20% to venture capital firms — would Bitcoin still have attracted such diverse talent and capital? Would it have grown to the scale we see today?
The article on Lvdong is right. The founding team of an infrastructure project should design a token economics that is open and fair to everyone. If VCs want to participate, they can only do so through fair launches rather than taking cheap quotas.
https://www.theblockbeats.info/news/55074?from=telegram%EF%BC%89
Is it very similar to ZKfair? At that time, ZKfair was launched with fairness, and many people who followed it made a lot of money.
(II) Ethena’s market performance in the same track
If Ethena is a VC coin, the price VC gets is much lower than that of community participants, so the token was quickly smashed back after reaching a new high on Binance within a few days. There were also several releases during this period, resulting in the current poor market performance of Ethena, and $ena has fallen nearly 60% from its high.
3. What does Pure.cash want to do?
What Pure .cash wants to do is to airdrop 100% of all tokens to the community through a fair launch mechanism. There will never be a situation where 20% of the tokens are allocated to the team itself, 20% to the foundation, another 20% to venture capital companies, the rest to exchanges, and the last bit to users.
If the Pure .cash project wants to retain tokens and carry out subsequent market maintenance, it must also participate in the project's coin issuance process or take a little from the transaction fees.
If VC is optimistic about the development of a project, they will use real money ETH to pledge or trade.
So what is the operating idea of Pure .cash and how is it different from Ethena?
2. Pure.cash Core Mechanism
1. Let’s talk about Pure.cash highlights first
Although Pure.cash is a decentralized version of Ethena, it does not just change Ethena, a DAPP. The project aims to revolutionize the crypto industry. It has the following highlights:
Pure USD (PUSD): A scalable, decentralized synthetic dollar;
LongOnly: Zero funding rate perpetual contract product;
Reverse issuance model: 100% of the maximum token supply is airdropped at the token TGE, followed by continuous token destruction;
Fixed price destruction mechanism: a revolutionary innovation enabled by Token.
2. Pure.cash Core Mechanism (Difference from Ethena)
From a fundamental perspective, Pure .cash is a decentralized version of Ethena, adopting a delta-neutral strategy and using perpetual contracts to issue the stablecoin PUSD.
Pure.cash
There are two core functions: PUSD and LongOnly
1、PUSD
PUSD is minted by ETH. After minting, the system will generate an equal amount of short positions and always maintain a delta neutral state.
This is basically the same as Ethena. Let’s use Ethena to understand the sentence “Pure.cash adopts a delta neutral strategy and uses perpetual contracts to issue the stablecoin PUSD”:
Ethena's mechanism is like a seesaw. Its stablecoin is called USDe. If the price of ETH is 1 USD, when 1 USDe is minted, the system will entrust 1ETH to the derivatives exchange to short 1ETH.
If the ETH price drops from 1 USD to 0.1 USD, the short contract value of 10 ETH*0.1 USD is still 1 USD;
If the price of ETH rises from 1 USD to 100 USD, the short contract value of 0.01 ETH*100 USD will still be 1 USD. By opening a contract for hedging, the balance of the seesaw can be achieved, and ultimately a native decentralized synthetic USD with equal collateral can be created.
Based on the above content, the key information of Ethena is extracted as follows:
Internet Bonds
Delta Neutral
Yield
Here we will take a look at how to understand "yield".
2、LongOnly
Pure.cash differs from Ethena in that it has a dual function:
Pure .cash not only issues PUSD stablecoin
The decentralized LongOnly perpetual contract protocol is also integrated into the project
This integration enables Pure.cash to enable permissionless minting and burning without any third-party custodial risk.
This is in stark contrast to Ethena, which deposits assets on CEX exchanges for hedging, resulting in unstable funding interest income and possible losses.
In addition, Pure .cash is expected to demonstrate strong profitability by integrating its own LongOnly perpetual contract product (the funds for subsequent project parties to repurchase tokens will be generated from here).
(III) Stability guarantee
The dual mechanism of Pure .cash is very clear, that is, using Pure USD to go short and LongOnly to go long, but what if both are shorted or both are longed? How to balance the two?
Pure .cash uses two models to solve the above problems: Stability Fund and PSM
Stability Fund: When the PUSD supply exceeds the long position excessively, the Stability Fund will implement an active redemption mechanism;
PSM (pegged stability module) is mainly designed to prevent a large positive premium on PUSD during large-scale repurchases and ensure that the redemption mechanism remains economically viable.
In addition to the above stabilization mechanisms, the system also absorbs the imbalance of long and short positions for liquidity providers (LPs) within their liquidity range and obtains 35% transaction fee income.
3. Pure.cash Token Economics
100% of Pure .cash tokens will be airdropped to the community in one go, while tokens will be destroyed continuously.
1. Token Allocation Mechanism
PURE tokens will be distributed entirely to the community via the Genesis Airdrop, with no share reserved for the founding team or venture capital firms.
The protocol developer Pure .cash Labs will receive 20% of the platform's fee income to ensure that all community users can participate fairly, and the remaining 80% of the fees will be allocated to LP, PURE destruction pool and $PUSD application scenarios.
What is relevant to us here is the points airdrop, which accounts for 70% of the tokens. Users only need to provide liquidity, go long on LongOnly or mint PUSD.
The requirements for referral rewards are high. Since Pure.cash is not a referral-based project, you can only recommend 3 users at most, so you can only send invitation codes to high-potential customers.
2. Reverse issuance model
Other projects will first issue 20% and then slowly unlock it, which is the common way of VC. However, Pure.cash adopts another issuance mechanism: reverse issuance model.
First, 100% of the tokens will be issued at once, leaving the users to decide for themselves. After that, the tokens will be destroyed continuously and new tokens cannot be minted. The circulating supply of tokens issued under this model can only decrease over time.
(III) Fixed price destruction mechanism
The fixed price destruction mechanism (FPB) is a breakthrough solution launched by Pure.cash to address the challenges of token empowerment in current DeFi projects.
Pure.cash
A fixed burn price is set (adjustable via the DAO), and protocol revenue (35% of total transaction fees) is continuously injected into the burn pool. This mechanism allows anyone to burn $PURE and receive assets from the pool at a fixed burn price.
FPB is implemented entirely through on-chain smart contracts. It is worth noting that the special feature of this mechanism is that it not only continuously reduces the token supply through destruction, but also acts as a floor price buffer.
4. Pure .cash Airdrop Tutorial
Pure .cash mainly uses a points system to distribute airdrops. There are three ways to earn points:
Group LP to provide liquidity
Open more in LongOnly
Directly stake PUSD or Curve LP
You don’t need to do every section above, just choose one of them. The specific tutorial is as follows:
1. A group of LPs, providing liquidity
Step 1: Enter the official website
Official website link: https://app.pure.cash/airdrop?invite_code=JYRVBG
Sufficient ETH is required
Step 2. Click “Buy PLP” on the airdrop page or the “Pool” button at the top to enter the purchase interface.
Step 3. Enter the amount of ETH you want to provide, and the system will calculate the amount of PLP you can get.
After the wallet is confirmed, you can see the PLP balance and ratio on the left.
(II) Open multiple accounts on LongOnly
Step 1: Enter the official website
Official website link: https://app.pure.cash/airdrop?invite_code=JYRVBG
Sufficient ETH is required
Step 2. Click “Open a position” on the airdrop page or “LongOnly” at the top to enter the position opening interface.
Step 3. Enter the amount of ETH you want to spend. You can also adjust the leverage yourself.
After the wallet is confirmed, you can view the holding details on the left.
It should be noted that not everyone can open a contract, so please choose according to your actual situation.
3. Directly pledge PUSD or Curve LP
1. Staking PUSD
Step 1: Enter the official website
Official website link: https://app.pure.cash/airdrop?invite_code=JYRVBG
Sufficient ETH is required
Step 2: Get PUSD
Click "PUSD" at the top of the page to enter the purchase interface;
Enter the amount of ETH you want to spend. After entering, the system will calculate the expected amount of PUSD to be received; confirm with the wallet.
Step 3: Stake PUSD
Click "Airdrop" at the top to enter the airdrop interface
Click "All Pools" to enter the mining pool interface
Click “Stake”
Enter the amount of PUSD you want to stake;
After confirming that the information is correct, click the “Stake” button and confirm the transaction in your wallet.
2. Curve LP Token
Step 1: Get Curve LP tokens
Click "Airdrop" at the top to enter the airdrop interface
Click "All Pools" to enter the mining pool interface
The Pools page will list all Curve pools supported by the system. Click “Go to Curve” to go to Curve to add liquidity.
After successfully adding liquidity on Curve, you will receive corresponding LP tokens.
Step 2: Stake Curve LP tokens
Click "Airdrop" at the top to enter the airdrop interface
Click "All Pools" to enter the mining pool interface
Click “Stake”
Enter the amount of Curve LP tokens you want to stake and the wallet will confirm.
After the transaction is completed, you can see the amount of your pledge in the mining pool
