Successful protocols don’t replicate the current meta. They build in response to it and anticipate where it’s headed.

Throughout our protocol history, we’ve been ahead of a number of now popular DeFi themes:

• One of the first to meaningfully tokenize real estate, bringing over $50MM in property on-chain since April 2022

• One of the first rebasing RWA-backed stablecoins with off-chain yields, launching Real USD in Fall of 2022

• The first to use off-chain yields within a ve(3,3) flywheel to build a sustainable solution to liquidity incentives

The launch of re.al was in no way a category-leading endeavor. re.al is amongst the first 100 or so L2’s in the “1,000 L2” thesis, but feels very much amongst the clutter of emergent L2s battling it out for liquidity.

Nor were we the first to launch a points program to help jumpstart the chain and incentivize early users. Airdrops are a category standard and points programs are now all too common…as are complaints about the execution of the points programs.

However, our executional approach to the points program, L2 ecosystem design, tokenomics and value accrual run completely counter to that of any other existing protocol. Within the L2 congestion, we’re building out a value-driven ecosystem that’s unique to any other L2 in the market.

In this article, we’ll highlight what we believe to be the upcoming metas this cycle, with re.al being amongst the first on all of these themes.

0: Fully Circulating Tokens, Fairly Launched

$RWA’s tokenomics are the foundation allowing us to build the way we want, setting new trends for this cycle. So let’s quickly recap on current category truths and establish some of the $RWA fundamentals.

The low float, high FDV meme is dead. Cobie killed it and users have gotten wise to the tricks played by value-extracting VCs. Tracking unlocks has become a full-time job for certain KOLs in the space, warning users of “more coins” poised to hit the market, diluting investor value.

Imagine investing in Lido, DeFi’s largest protocol, at a $40MM market cap. You’d be rich at the current $1.7B market cap, right? Not so fast…

Fair launched tokens are also not a new theme, from ICOs, to memes and Pump.Fun, and fair launches for protocols like Sanko (another Orbit chain) who used Arbitrum-aligned Camelot to facilitate their TGE.

DeFi users and traders now favor fully circulating tokens, memes chiefly amongst them, for the native transparency in their token design. One could easily argue that “VC tokens” carry more perceived downside risk from unlocks than they do upside gained from the vetting process inherent in funding.

$RWA shares many of the same positive characteristics of the tokens which have dominated attention this cycle:

1. Fully circulating supply that can be traded/sold at any time

2. No VC bagholders looking for an exit

3. Majority distribution amongst users and community

While our team did raise a $400k pre-seed nearly three years ago, we were able to buy back nearly all of this stake prior to showing product-market fit.

With the team and community fully in control of a fully circulating supply, we’re free to execute a strategy many others in the space cannot as a result of FDV scams and having to satisfy institutional investor needs before those of users and the community.

1: Transparent Rewards Program

Even before exhaustion with the current points meta was clear, we were using our unique set-up to design a new type of rewards program that better aligned the interests of early users and the protocol.

We viewed the incredibly long, opaque, sybil-focused farming programs as fundamentally flawed. Protocols used these programs to juice TVLs and volume which they then raised off of, taking more equity from the users creating this value and giving it to funds and the team.

At the same time, there are countless KOLs forecasting FDVs based on pre-market OTC to drive program attention. This is simply another trick used to create a false sense of program value for the users. Paid shills project FDVs multiples higher than what’s reasonable, driving more eager farmers into a system built to extract value.

Users get farmed by the protocols in non-transparent programs designed to exploit them while teams and funds get rich.

NO ONE SHOULD HAVE TO GUESS WHAT THE VALUE OF THEIR TIME AND MONEY IS WORTH.

The $RWA rewards program was designed to be better, a transparent system giving users a real-time estimate of their rewards based on the actual value of the rewards token. Tokens tracked, multipliers and even the scraping algorithm are all available at any time for users to review.

10% of total supply is up for grabs across 8 months. No less than 10% of any and all tokens are available to claim. Regardless of our success, these terms do not change.

$RWA rewards stream daily to ecosystem participants, with daily rewards APRs transparently placed alongside any points-accruing opportunity in the ecosystem, regardless of protocol. We view certain opportunities as better for ecosystem growth than others and reward those as such, with users able to make their own decisions on which liquidity contributions fit their needs and interests.

Immediately after the first two-month season, users will accrue real value for their efforts. All users, regardless of size will get the same lock terms on their rewards. Whales won’t be forced to watch as unlocked tokens get dumped on their vesting bags. Users can take their funds elsewhere, not forced to continue farming to claim their earned rewards.

re.al is the only protocol, certainly the only L2, with a rewards program this transparent, designed to benefit the users as much as the protocol. However we won’t be the last to do this, we’re already seeing other protocols embrace a more transparent and predictable approach to rewards.

Swell, one of the major liquid staking/restaking apps, recently announced their token TGE and their next airdrop campaign, which is a “liquidity mining [program] with predictable airdrop schedule.” $RWA rewards are unique in that they’re deflationary. Nevertheless, we’re pleased to see other savvy protocols embracing a better, fairer approach to airdrops.

2: The L2 That Returns Value to Users

Outside of majors dominance, we view the trading meta of this cycle to be a story of two complementary assets: memes and revenue tokens.

Speculating on useless governance tokens is over. This has been killed by the high FDV, low float scam and memecoin dominance. When they’re not a product of cabal shenanigans, a 100x or 1000x is the result of a token winning the attention game. And no other tokens this cycle have proven to earn as much attention as memes. They’re also generally transparent, fairly launched and fully circulating, with more obvious risks (rugs/scams) than VC-backed governance tokens. Many believe memes are pure upside.

Complimenting memes will be revenue tokens. Assets designed to capture fees and return them to users. Trading fees, borrowing fees, staking yields, basis trade yields, RWA yields, etc., both in stable and non-stable designs. Protocols generating revenue will be expected to share those rewards with users if they want to generate attention and demand for their token. Fewer users will take the risk on protocol altcoins that lack a value accrual mechanism.

This is where re.al and $RWA have the opportunity to capture attention through the remainder of the cycle, leading the conversation:

• re.al is the only L2 to where users benefit directly from the growth of the network and ecosystem

• $RWA is the first L2 governance token to fully capture chain value and return it to users, including all transaction fee profit and revenue from protocols deployed across the re.al ecosystem (please see our terms and conditions for jurisdictional restrictions)

• Value is returned to $RWA lockers in reETH, a liquid staked ETH, not through inflationary rewards

• $RWA is deflationary

$RWA currently accrues value from eight different sources throughout the ecosystem, a number that will continue to grow, driving $RWA returns higher.

3: Vertically Integrated Chains and Mega Tokens

$RWA is a mega token. It’s the recipient of value from five different protocols operating within an ecosystem. Over the following months, this number will continue to grow.

Incredible work has been done to innovate and build the safe and reliable DeFi primitives currently available in the market. With a proliferation of nearly-identical options, many forks of the same underlying code, DeFi primitives have become commoditized with protocols differentiated only by brand or chain. Of course, most of these protocols have their own token to support the team and their own community to support that token.

New teams building on the chain bring more exposure and new communities into the ecosystem. But ultimately incentives are all that matter and we view accruing more value and incentives to $RWA to be the better long term strategy, expanding our own community versus borrowing from others.

re.al will pursue a future where secure, open-source code is leveraged to build a fully integrated DeFi ecosystem with all fees paid back to the locked version of $RWA. If communities are marketing and incentive alignment mechanisms, then collecting multiple protocols under one token should also increase marketing and operational efficiency. One token, one community.

These new protocols will be built to fit seamlessly into our ecosystem, accounting for the benefits of incoming off-chain yields, rebasing yield mechanisms and natively cross-chain assets. They will fill critical gaps in the ecosystem, leveraging battle-tested code to improve liquidity flows on re.al.

Most importantly, 100% of the fees from new protocols the team deploys, including those from Surge as well as the money market will accrue back to locked $RWA.

4: Real Valuations Based on Fees Generated

In addition to returning value to users, our model makes it easy for funds and the community to properly value an asset. Using a classic p/e calculation based on fees generated, one can quickly get to a reasonable estimate of a fair FDV agnostic of market sentiment and inputs.

Of course attention still matters and the category will inherently speculate in these models based on expected future success which is largely determined by attention. However the token APY serves as a legitimate jumping off point for actual asset value.

In the case of re.al, $RWA’s deflationary characteristics create asset scarcity while also increasing value accrual independent of any incremental growth to revenue. It’s the perfect design for value seekers.

It’s now in the protocol’s interest to maximize value accrual for token holders as a means to maximize the value of the protocol itself. It’s also in the interest of the protocol to expand its business while consolidating revenues behind one token. The vertically integrated ecosystem becomes the standard path forward for DeFi protocols to increase their value through revenue distribution.

2024 Cycle Metas:

1. Transparent Rewards Program

2. Revenue Tokens

3. Vertically Integrated Chains and Mega Tokens

4. Fee-Based Valuations

We expect these topics to become widely acknowledged metas through the remainder of this cycle. re.al will have been among the first to them all with our community and $RWA holders the primary benefit of this shift.