Economics

With the Uncharged Protocol, all token holders will be contributing to this system via a portion of the 5-10% annual token inflation. Specifically, those who wish to access services must lock up their tokens, rendering them unable to sell these tokens until they finish using the service. Clients requiring long-term or continuous services may lock up their tokens for an indefinite period.

As the demand for services increases, leading to more tokens being locked up at a rate higher than the inflation rate due to the platform's growing market and commercial scale, the token economy undergoes an effective monetary deflation. This deflationary trend increases the value of tokens earned by service providers, encouraging them to offer a broader range of superior services.

Should there be a substantial decrease in service demand, the released tokens might flood the market, leading to an effective price drop beyond the standard inflation rate. This means the value of tokens may decrease, and the quality or quantity of services that providers can afford to offer might decline. However, due to the reduced demand, providers could choose to scale down their service offerings, thus reducing operational costs. Alternatively, adjustments could be made to the staking mechanism, recalibrating the number of tokens a client needs to stake to access a service.

Ultimately, clients in need of services fund the ecosystem via the time-value of their staked tokens. This ensures a smooth user experience with no micropayments, no transactional hurdles, and no unexpected fees.