Adrien Hubert and Jules Bertrand on $CLAP, the innovative and hitch-free tokenomics
While every blockchain ecosystem needs to build a robust product, robust tokenomics is just as important! Far too many projects have launched their own cryptocurrency without really knowing why. Let’s to zone in on the tokenomics with Adrien Hubert and Jules Bertrand.
Hi Adrien, hi Jules, could you introduce yourselves please?
Adrien: Sure! I am one of the founders and also the CFO of SmartChain, the company in charge of Cardashift’s tokenomics. My experience is in banking and monetary innovation, in particular at the Caisse des dépôts (the investment arm of the French state).
Jules: Thanks “boss”! As for me, I’m not cut from the same cloth (laughs). I’ve been at SmartChain for a year, working as a developer specialized in infrastructure. Setting up blockchain nodes is my main passion, but I’ve had to shelve it for the time being because I am currently a Product Owner and Manager at SmartChain.
Having said that, I’m just as interested in economics as Adrien is, as well as in tokenomics. That’s why I am also the tokenomics adviser on a number of projects, helping find the best way to increase the value of each project’s token.
How did you get into blockchain?
Adrien: I read an article about it back in 2013, but like most people I didn’t really see the process through — unfortunately, I didn’t buy any Bitcoin at the time.
Jules: The upside is that you managed to steer clear of the MTGOX hack (laughs). And anyway, you wouldn’t have HODL!
Adrien: You’re probably right! Well, in any case, in 2015 I had to write a dissertation on the future of currency as part of my degree. I completely fell for blockchain while doing the research for it, since in a way blockchain is about being able to create central banks. After so many years spent pondering various financial models, for example, financial transaction taxes, Humanity had at last come up with a way of putting these models into practice!
One thing led to another and I wound up project leader at the French Caisse des dépôts where I had a lot of fun playing around with blockchain applications. Like so many others, I was hooked.
Jules, why don’t you quit being a wise guy and tell us how you got into blockchain?
Jules: Back in 2016 via, online casinos. I was underage and Bitcoin was the only means of payment I could use to get around the age restrictions. If you look at the price of Bitcoin today and do the maths, well, I lost A LOT of money.
Adrien: I can see now where your “you wouldn’t have HODL anyway” came from — you’re speaking from experience (laughs).
Jules: That’s right (laughs). I got back into blockchain properly during the March 2020 lockdown prompted by Covid-19. I was studying computer science at the time. Since I had a lot of time on my hands I began reading Bitcoin’s veeeeeeeeeeeeeery long code. And here I am today, a blockchain junkie!
Adrien, given your background, do you think that the traditional economy is bound for extinction?
“Will the traditional economy be turned upside down by tokenization and DeFi?”. The answer is yes, without a shadow of a doubt! — Adrien Hubert
Adrien: You could say that the “traditional” economy has been going extinct for centuries, then rebuilding itself each time. So the real question is “will the traditional economy be turned upside down by tokenization and DeFi?”. The answer is yes, without a shadow of a doubt! And we’re still in the early days!
Jules: 1 $ADA, how much do you bet it’ll be worth in 10 years time?
Adrien: I believe that almost all financial flows are going to transit via the blockchain. Of course, there’s another scenario: Central Bank Digital Currencies (CBDCs) come out on top, giving rise to ersatz blockchains.
You’ve talked about tokenization and DeFi, both of these advances were introduced by Ethereum… So why did you pick Cardano instead?
Adrien: They’ve come up with a real vision of what a blockchain should be: a decentralized system. I personally don’t have much faith in blockchains which start out centralized in order to meet user needs, then decentralize bit by bit.
What I also like is that Cardashift is keen to reach out to people who do not have access to the banking system right now, this is the way to achieve mass adoption in the short-term. Conversely, targeting crypto users is not particularly helpful because, as we’ve seen, many of them will migrate from one blockchain to another based on where there’s more money to be made.
Last but not least, they’re implementing robust, long-term solutions. Although this is time-consuming due to Haskell, as I am sure Nicolas already told you, it brings a lot of added value in terms of scalability and robustness. If you like reading, Cardano is right up your alley — its team has penned loads of research papers!
Jules: Indeed, Cardano is a real laboratory, we’re still at the very early stages, everything still needs to be built. That’s why it makes sense to make Cardano stand out from the pack by having a real project behind it. It’s something you don’t get on other blockchains.
Why did you decide to become part of Cardashift?
“A project where blockchain would make a tangible impact on the world” — Adrien Hubert
Adrien: We were looking to get involved in a project where blockchain would make a tangible impact on the world. In addition, we firmly believe that tokens linked to environmental products are going to be one of the major topics in the coming years.
How do you build robust and effective tokenomics?
“Lots of projects make the mistake of getting rid of the correlation between the life of the platform and the life of the token.” — Jules Bertrand
Adrien: It requires a lot of cross-cutting skills. The goal is not to create a token for its own sake. Hence we have to come up with simple and smart ways of making it useful and of getting it to increase in value.
I call these common incentives, by which I mean that if the platform is used how it should be, then the token’s value will go up.
Jules: Lots of projects make the mistake of getting rid of the correlation between the life of the platform and the life of the token. Tokens don’t work like shares, investors don’t buy them based on the issuing company’s underlying revenues. Granted, the experience of some large protocols such as Compound contradict what I’ve just said, but they were already up and running before they even had a token.
In the overwhelming majority of cases once a project sets up a token it has to link it to its platform. For instance, the fees levied on a payment have to be channeled through treasury, temporarily reducing circulating supply. Or there’s buyback-and-burn, which means that some tokens are withdrawn from the market once and for all. Meanwhile, at Cardashift 1% of the treasury inflows will be burnt. This is one of the mechanisms which allows $CLAP to increase in value.
Why burn tokens when you could buy them back like we do on the stock market? At the end of the day, doesn’t that amount to admitting that you don’t believe in your own growth prospects?
Jules: Once again, we mustn’t forget that cryptocurrencies don’t work like stocks. In Cardashift’s case, just like in many others, we own a percentage of the total supply. By burning some tokens not only are we driving up the value of the tokens we own, but we are doing so without increasing centralization. Conversely, buybacks tend to centralize supply in the hands of the project team. This is at odds with our vision of decentralization.
Which part of Cardashift’s tokenomics are you most proud of?
Jules: The model, no doubt about it. Thanks to its model, $CLAP can be placed in liquidity pools, as well as pulled out of them if the project in question doesn’t match Cardashift’s or our stake pool’s values. Each project will have its own ADA nodes, meaning holders will be able to stake their ADA and get free project tokens in exchange.
What do you bring to the Cardashift table?
Adrien: I would say my ability to see the big picture. I can easily jump between different topics, which is why I often serve as the coordinator between different parts of the project.
Jules: In my case it’s my analytical skills! I can figure out very quickly if something is going to be viable in the short, medium, or long-term, which is why tokenomics appeals to me.
I have the acumen, I know how to deploy it, and at Cardano I get to really test out very long-term goals. Also, I’m only 22, which makes me a “blockchain native”. This means I can look at crypto topics through a different prism.
Last question: describe Cardashift in 3 words?
Adrien: passion, challenge and together
Jules: virtuous, ambitious and rewarding
Discover Cardashift Tokenomics: https://cardashift.medium.com/clap-a-utility-token-to-power-the-cardashift-ecosystem-7bf3fb862cc
