Understanding Pumpopoly's Tokenomics Model

Basics

Pumpopoly is a virtual real estate simulator built on the NEAR blockchain. Property prices are denominated in Pumpopoly tokens. Lands are bought and sold in-game with these native tokens. The token contract adheres to NEAR's fungible token standard. Pumpopoly tokens are interoperable with all platforms which support this standard. Tokens can be traded at Ref.finance for NEAR, where a swap pool already exists.

Issuance

Tokens are issued directly from the game's smart contract. Users can choose to purchase tokens from the swap pool or have new tokens issued.

New tokens are issued along a price curve. The issuance price increases along the curve as tokens are issued. Here are two views of the curve at different zoom levels. The blue point illustrates the current price and issued volume.

Figure 1. Close zoom displays a straight line of growth.

Figure 2. Expanded zoom displays exponential growth

Both lines depicted in figures 1 and 2 exist along the same price curve. The rate of growth increases as the number of tokens issued increases. Visually they may appear differently only because the scale on the vertical axis has been zoomed.

Pumpopoly's in-game market creates demand for tokens inside of the game. Tokens exiting the game can be swapped out on external exchanges at a discount to this pricing curve. Players should expand the supply of tokens only when the swap rate exceeds the price curve. When the swap price is lesser than the issuance price, players will logically choose to buy at the discounted swap rate.

Figure 3. The issuance price of approximately 7.388 NEAR after 20k PUMPOPOLY tokens have been issued.

Figure 4. Historical token issuance price chart.

Opportunities abound

DAOs, whales and other large players can drive the issuance price higher and participate on 3rd party token exchanges. Tokens are issued at the current rate. The difference between the current issuance price and the issuance price after a large purchase represents an opportunity.

As of October 25th, 2022 the current issuance price is approximately 1.05274 NEAR. A purchase of 20,000 tokens at this rate would drive the token price above 7.38 NEAR per token. This is approximately a 7x increase in price. Please see figures 3 and 4 above.

Disclaimer

As with all cryptocurrency articles on the Internet, this is not investment advice. Furthermore, Pumpopoly.com is a gaming experience, not an investment. Buyers of large blocks of tokens should evaluate future in-game demand before participating. The above example is only intended to illustrate the mechanics of Pumpopoly's tokenomics model.