Sonic’s Deflationary Strategy: Will Developer Rewards Surpass Market Fluctuations?
- Sonic Labs, under new CEO Mitchell Demeter, is prioritizing deflationary tokenomics and ecosystem growth through a revised fee monetization system. - The updated FeeM model allocates 15-90% of fees to developers, 10% to validators, and burns remaining funds to reduce S token supply. - S token (S) trades at $0.14 with $546.8M market cap, while Sonic's TVL fell to $126.65M from $1B peak despite 370,000 TPS capacity. - Demeter emphasizes U.S. expansion, Ethereum/Solana competition, and institutional engagem
Sonic Labs, which operates the EVM-compatible Layer 1 blockchain
Under the revised FeeM model, builders receive between 15% and 90% of network fees depending on transaction volume, validators are allocated a fixed 10%, and the rest is burned, as reported by
Demeter’s vision goes beyond tokenomics. Sonic intends to implement
This strategic pivot mirrors a wider industry movement toward foundational value. "This cycle will be shaped by strong fundamentals, transparent economics, and reliable execution," Demeter remarked, contrasting with the speculative nature of earlier market cycles, as noted by
The community’s response has been cautiously positive. Analyst zethesx observed that allocating up to 90% of fees to developers could "benefit the future" by making $S more deflationary, as per
Looking forward, Sonic Labs aims to broaden its international presence by enhancing developer resources, forming institutional collaborations, and launching educational programs through its GMSonic platform, as highlighted by
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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