When our team at Storj Labs architected the STORJ token sale, our goal was to ensure we had enough runway to realize our grand vision: to build the largest, fastest, most secure, decentralized cloud storage platform in the world. To accomplish this lofty goal, we created a reserve of 245 million tokens we could use in the future to fuel the growth of our network. These tokens were placed into a six-month lock-up to be used at a later date.
Among the ways we envisioned using these tokens included: financing future developments of Storj and the network, employee compensation, for grants or the purchase of equity in partners and other third-party projects built on top of the Storj ecosystem, Farmer payouts and incentives, a bounty program to incentivize certain projects and many other uses.
These reserve tokens are critical to the long-term success of Storj and the network. Rather than selling all these tokens during the crowd sale earlier this year, we saw value in reserving them, so we could incentivize the community with tokens, giving them a reason to earn and use the tokens on the network.
The lock-up for these STORJ tokens was slated to end December 20, 2017 at 12:00 AM ET - the same time as the final tokens from the token sale will become unlocked for token sale participants. Today, we are announcing an additional six-month lock-up for the 245 million STORJ tokens in our reserve. None of these tokens will go into circulation at this time. Ahead of the end of the next lock-up period, the Storj Labs team intends to announce its STORJ Token Distribution Plan. The goal of this plan will be to clearly outline how these tokens will be used and over what period of time.
In six months, we expect to have a much better idea of the economic necessities and factors related to the token. There are currently some challenges around calculating how many tokens we will need over the coming years. Some of the factors we considered when discussing this new six-month lock-up include:
- Farmer payouts. We are currently rearchitecting our Farmer payout model. We plan to roll this out in Q1 next year. We currently utilize the majority of our liquid Storj-owned tokens for Farmer payouts, so this will be an important part of the Storj Token Distribution Plan.
- Economics behind the STORJ token. The current token marketplace is somewhat unpredictable. Our hope is that a clear distribution plan will bring stability to STORJ token marketplace.
- Scalability and technical improvements. We are currently making major product performance improvements aimed at enhancing our scalability. To give you an idea of how quickly we are scaling, we stored 5PB of data in September, 12PB of data in October and 20PB of data in November. In six months, our growth trajectory is expected be much more clear and predictable.
- Utility improvements for STORJ. As we enhance utility around STORJ, we expect the demand for our tokens to change. Our goal is to ensure the STORJ Token Distribution Plan matches supply with demand.
We want to be as transparent as possible around how we are using these tokens. We view the community as an extension of our internal team and want to ensure everyone feels they have a voice in what Storj aims to become. The Storj Labs team is committed to building the largest decentralized cloud storage platform and we look forward to rolling out the STORJ Token Distribution Plan, which will highlight how we plan to accomplish this from a financial perspective. Stay tuned for more details in the first half of 2018!