Phantom_illusion Official

Tokenomics often make or break a crypto project. While researching DUSK, I uncovered a strikingly unusual design in its token release schedule: of the total 1 billion tokens, 500 million are already in circulation, while the remaining 500 million are set to be gradually unlocked over 36 years for stakers.

Wait—36 years? Bitcoin has existed for only 17 years. Is this extended release meant to protect long-term value, or is it a way for early investors and the team to maintain control? Let’s break it down.

Initial Allocation

DUSK’s total supply is 1 billion tokens, allocated as follows:

50% to token sales (500M)

18.1% to development (181M)

6.4% to team & advisors (64M)

The rest for marketing, ecosystem incentives, etc.

On the surface, the allocation seems reasonable—but at what price were these tokens sold? DUSK conducted an IEO in 2019 at $0.03–$0.04. Early investors are already up 50–100%, while retail buyers near the 2021 ATH of $1.09 are down 94%. The gap in returns highlights the unfair distribution.

The 36-Year Release Mechanism

The remaining 500 million tokens are to be unlocked through a “geometric decay” model, rewarding stakers. This superficially resembles Bitcoin’s halving—but unlike Bitcoin’s transparent and immutable schedule, DUSK’s release lacks detailed documentation.

Roughly, 500 million tokens over 36 years averages ~13.9 million tokens per year, though early years may release 20–30 million tokens, adding continuous selling pressure to the market. At the current price of $0.059, a 25 million token release in a year could translate to $1.47 million of potential sell pressure. In a bear market, this could trigger panic selling, harming both price stability and staker confidence.

Unlike Ethereum or BNB, which have mechanisms to reduce supply or burn tokens, DUSK continuously inflates its supply, risking chronic depreciation.

The 10% Compounding Penalty

DUSK’s Sozu staking imposes a 10% penalty for compounding, claiming it controls inflation. But compounding demonstrates user confidence in the project. Penalizing loyal users discourages growth, artificially limits staking scale, and appears to patch underlying flaws in the token model rather than genuinely protect holders.

By contrast:

Cosmos (ATOM): free compounding, stable APR (~17%)

Polkadot (DOT) & Solana (SOL): auto-reinvest staking rewards

DUSK’s penalty-driven approach creates inefficiencies—currently, 3.7 million DUSK sits idle, not contributing to network security or value creation.

High Concentration & Team Lock-Up Issues

On-chain data shows the top 10 addresses control 73.87% of circulating supply, with the largest holding 21.21%. Combined with the team’s 64 million tokens fully vested in 2022, a few actors could dump large amounts at any time. In practice, this concentration gives them disproportionate market influence and leaves retail investors vulnerable.

Comparison to Other Chains

Avalanche (AVAX): 720M supply, team tokens locked for 10 years, quarterly transparent releases, transaction burn mechanism

Secret Network (SCRT): 96% of total supply in circulation, minimal future sell pressure, more price stability

DUSK, with 50% supply unlocked and 36 years of inflationary releases, faces far higher long-term risk.

Sustainable Staking APR?

DUSK’s advertised 28% APR relies heavily on new token inflation rather than transaction fees or ecosystem activity. With low on-chain activity (~$90k daily volume), the APR may fall as staked DUSK rises, undermining incentives.

36-Year Timeline: Unrealistic in Practice

The crypto industry evolves rapidly; new technologies may replace existing paradigms every 3–5 years. DUSK’s 36-year schedule assumes the project remains relevant decades into the future—an uncertain bet. Large holders could also manipulate governance to adjust release schedules, further undermining retail investors.

Conclusion

DUSK’s tokenomics appear designed to benefit early investors and the team, not long-term holders:

36-year release schedule creates chronic inflation

Compounding penalties discourage loyal users

High concentration of holdings amplifies market risk

Team tokens are freely circulating

For long-term investors, alternative projects with transparent, controlled supply mechanisms like SCRT or upcoming Aztec mainnet may offer more sustainable opportunities.

Unless DUSK can demonstrate real ecosystem demand and adoption within the next few years, its token economics may continue to erode investor value.

@Dusk $DUSK #dusk

@Dusk | |
The DUSK Project is a pioneering blockchain platform designed to bring real-world financial privacy to digital finance. Unlike traditional public blockchains, where all transactions are visible to anyone, DUSK enables confidential, secure transactions while remaining fully compliant with regulatory standards. By combining zero-knowledge proofs, private tokenized assets, and compliant smart contracts, DUSK creates a blockchain infrastructure that is not only private but also practical for institutional and regulated financial operations.
At the core of DUSK’s privacy model are zero-knowledge proofs (ZKPs), a powerful cryptographic technique that allows one party to prove the validity of a transaction without revealing any sensitive information, such as amounts, asset ownership, or counterparty identity. This ensures that transactions remain confidential, while still verifiable by authorized parties, such as regulators or auditors. By leveraging ZKPs, DUSK strikes a delicate balance between transparency for compliance and privacy for security, addressing one of the fundamental challenges in blockchain adoption for finance.
Another key feature of DUSK is its support for private tokenized assets. Tokenization enables real-world financial instruments such as equities, bonds, derivatives, or other securities—to exist on-chain as digital assets. On DUSK, these tokenized assets are not only programmable but also encrypted and confidential, ensuring that only authorized parties can view transaction details or ownership data. This makes it possible for banks, asset managers, and institutional investors to trade and manage financial instruments on blockchain without exposing sensitive client information, a crucial requirement for adoption in regulated markets.
DUSK also integrates compliant smart contracts, which combine the flexibility of blockchain automation with built-in regulatory controls. These smart contracts can automatically enforce KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations, as well as investor accreditation rules, without compromising the confidentiality of transactions. This enables institutions to deploy decentralized financial services or execute complex financial operations in a legally compliant and auditable way, bridging the gap between the privacy needs of finance and the transparency demands of regulators.
The DUSK network is built on a layered architecture designed to optimize privacy, security, and performance. Its consensus layer ensures decentralized agreement on transactions, while the privacy layer uses zero-knowledge cryptography to protect transaction data. The settlement layer handles private transfers of tokenized assets, and the compliance layer provides regulatory oversight and integration with smart contracts. This modular structure allows institutions to adopt DUSK incrementally and securely, integrating blockchain functionality into existing financial workflows.
In practical terms, DUSK supports a wide range of financial use cases. Institutions can conduct private securities trading, execute confidential payments, manage regulated decentralized finance (DeFi) products, or perform cross-border settlements with reduced exposure to financial and operational risk. By combining privacy with regulatory compliance, DUSK enables blockchain adoption in scenarios where traditional transparent blockchains are unsuitable.
In summary, the DUSK Project is a next-generation blockchain platform that makes financial privacy practical without compromising compliance. By integrating zero-knowledge proofs, private tokenized assets, and compliant smart contracts, DUSK creates a secure, confidential, and legally auditable infrastructure for real-world financial operations. It empowers banks, businesses, and investors to leverage blockchain technology safely, bridging the gap between privacy, security, and regulatory requirements, and transforming blockchain from a speculative technology into a trusted financial tool.#dusk

@Walrus 🦭/acc | #walrus | $WAL
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@Walrus 🦭/acc | #walrus | $WAL
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