Friday FAQs #8

5 min readJul 8, 2023
Should we go for 10? I think we’ll go for 10.

Last week the Pakt Crew ventured out into the Nairobi Saturday night for an evening of Karaoke. The vocalizations ranged from Elvis to Burna Boy to Queen to Wizkid to Pavarotti’s Nessun Dorma. Watery light brews washed down laughs and vibrato a’plenty. The videos will go with us to our graves.

We recount our revelry to remind fellow founders to “touch grass.” Burnout Dodo-birds as many promising builds as poor execution, misbegotten ideas, or team friction. In fact burnout may often be the root of those Startup Causes of Death.

So whether it’s karaoke, surfing, ice fishing, go karting, trail running, hula dancing, squirrel suiting, zip lining, chessboxing, or any of a zillion other forms of recreation, remember to take time to get away from a screen and get your stress out.

With that said, time for us to grab the mic and belt out another excerpt from Pakt’s tokenomics via long answer aria, address the macro crypto moment with a medium length pop ditty, and bring the house down with a grand finale high note.

Long Answer: What is Pakt’s Business Model?

h/t VCs (excerpted from our Tokenomics)

The $PAKT token serves as the focal point of three intertwining revenue streams that unite to strengthen the Pakt ecosystem by fairly rewarding contributors who co-create it.

A dramatization of Pakt’s revenue streams

Revenue Stream #1: Pakt will charge a 1% fee on transactions occurring on Chainsites, a 2% fee on Chainsite revenues, and a 3% fee on Template and Mod revenues.

Revenue Stream #2: Once Pakt’s subnet is launched its validators will validate the Pakt subnet as well as partner subnets and in doing so earn rewards.

Revenue Stream #3: Once the Pakt ecosystem reaches full maturity, projects begun on Pakt will launch their own tokens and Pakt will receive 1% of issuance. These tokens will never be sold, helping “raise the basement” for projects in their early post-launch days. Rather, the tokens will either be staked on those projects’ subnets or provided as liquidity for DeFi purposes (DEX pools, lending, et al) and in doing so earn rewards.

These three revenue streams will funnel into a pool immutably smart-contracted to sell at market for $PAKT and $AVAX, a process circled in red on the admittedly Rube Goldbergian diagram below.

To us it kinda looks like a nuclear reactor. You seeing it too?

Thankfully, a 30,000 foot view of the full functionality of Pakt’s tokenomics makes the grand mission crystal clear:

The value created across all Pakt Chainsites is used to buy $PAKT for the purposes of rewarding ecosystem value creators and $AVAX for the purposes of purchasing validators to grow the validator set that is collectively owned by the Pakt Community.

These three revenue streams combined with the above value flow mechanism ensure that those who create value for the Pakt ecosystem will earn fair value in $PAKT in return, as determined by the constant recalibration of broader market forces.

The most important takeaway is that unlike hordes of crypto projects whose token price is reliant on hand-wavy moon math and irrationally exuberant market surges, Pakt’s Web3 ecosystem will be driven by real revenues and thus $PAKT will always have real value.

Medium Answer: Aren’t you concerned about building on Avalanche with the price of $AVAX taking such a beating?

h/t to cryptotwitter

Bubba, you must be new around here.

Yes, it’s true that the majority vibe in crypto ranges between shellshocked WWI vet and cornered honey badger. Yes, many HODLers’ $AVAX bags feel like they’ve been replaced with helium. And yes, this is all before the regulatory Category 5 storms brewing offshore make landfall (soon).

Honey Badger bought the top, escaped from his cage, and is raring to take it out on his Twitter feed

To that we say Bring It On.

It’s high time we separate the grifters from the gritty.

Pakt considers it poor form to call out flailing entities by name, but a casual scroll through cryptotwitter scans about 90% legal quagmires, 7.5% shilling, and 2.5% innovation.

Are those odds odious? Most soitenly. But what if that 90% were tuned down to 50%? And then 25%? Then 5%?

That’s happening as we speak. The bad actors who were never in it for the world-altering tech, the scenius community, the radically upgraded future but rather in it for get-rich-quick-schemey hit ’em, stick ’em, and run cash grabs are at long last getting their dirty schemes dragged out into public.

We all know who they are.

Good. And good riddance.

With these grifters dragged off to the gallows that 2.5% innovation will bloom across the Web3 mindspace, blossoming into 5%, then 25%, then 50%, then 90%. That’s when Avalanche and the projects building on it win. Because Avalanche isn’t constructed to outfraud frauds. It’s constructed to construct the future of digital value.

So here comes the storm. Welcome it. Shaking out early-adopter bad actors is an inevitable part of the innovation process. It’s time for the community to lash themselves to the mainmast and embrace an oft-overlooked fact about disruptive technology:

Disruptive technology is disruptive.

Changing the world isn’t supposed to be a cakewalk. Mainstreaming Web3 will not be a Zero Interest Rate Phenomenon 2010s startup with Harry Potter foosball tables and beanbag massage chairs and kombucha on tap.

If you dare to tell the powers-that-be they’re outta whack by brazenly building a better construct rest assured you’re getting punched in the face.

“What’d I do??! All I said was we’re replacing banks, the Internet, lawyers, stocks, currencies, and governments!”

If you want to win you gotta grin through your bloody lip, shake off the cobwebs from getting your bell rung, and charge onwards.

And we’ll be charging right along beside you.

Brief Answer: But when will the market pain end?

h/t to those down bad

When you BUIDL your way out of it.


The Pakt Crew




The OS for On-Chain Connection. Winner of the first Avalanche Creates Pitch Contest.