Tokens have devolved into casinos. What if you could engineer a token that was economically irrational to dump in the first hour. Can you put conviction onchain?
Ponzu is a token framework that enforces conviction through smart contracts. Every mechanism follows one principle: reward those who stay, penalize those who extract. What follows is not how Ponzu works, but why each piece exists.
90% Refunds
Most tokens have a choice: set low valuations to ensure sellout, or raise funds privately behind a SAFT until a unicorn-sized TGE. Both manage different risks. Both have become extractive.
Ponzu offers an alternative. Public presale, but you cannot dump at a higher price, only refunds. Get in early, but don't extract. Before launch, any participant can claim a refund: 90% of their capital back. The 10% stays in the pool, those tokens effectively sold and redistributed pro-rata to the believers who stayed.
For founders, this opens a middle ground I wish existed when I started building. Target a $1M valuation. Start at $100K and slowly sells out at $1M as it demonstrates product-market fit. Ship features. Watch the presale fill at increasingly justified valuations. This is much healthier than one that starts at $4K, sells out instantly, launches undervalued into immediate speculation.
Once your project has pumped and dumped, it's dead. Trust me.
For buyers, the thinking shifts from "is this a rug?" to "is this worth backing?" The 10% fee is intentional friction designed a conviction tax. And it goes to those who stayed till launch.
And if you do not want the penalty, your presale allocation is an NFT. Current price at $400K? You can either take the $90K refund, or sell on secondary. There is liquidity, but no dumping on the curve, no quick profits.
Only refunds. Commit your funds. Rest til launch.
Linear Pricing
Bonding curves look fun until you realize 50% of the supply can be bought for 11% of the total graduation cost. Each subsequent trade exponentially more expensive. The result: sniper bots, manipulation, a race to be fastest that has nothing to do with the project, or worse, bundling cheap tokens and controlling supply across hundreds of wallets.
Ponzu uses linear pricing. You set the target market cap. Price starts at a tenth of that target and increases linearly. The market validates your pricing through participation, not through arbitrage. As it fills, you build in public while the price gradually rises with your growing value.
This is the part I am most excited about for founders. The presale runs in the background. Ship features. Share an update. Watch the presale fill. No Zoom calls. No pitch theater. No term sheet negotiations. The worst distraction is hype, and a ticking clock for an auction or crowdsale. Ditch the clock. The smart contracts handle the economics. Stay focused, build the thing that makes your project valuable over time.
Diamond Hand Claims
In my brewery, you can only press once. Presale claims works the same.
Traditional vesting unlocks gradually over months or years. The problem: linear vesting creates thousands of micro-transactions. Claim a little today, a little tomorrow, sell continuously. Predictable, constant sell pressure. Cliffs only delay this death by a thousand cuts. Projects with traditional cliff based vesting also suffer from aggressive short selling to lock in the profits of the vest.
Diamond hand vesting flips this. You can claim only once. Exit early, but leave the rest. This is not punishment. It is agency.
For a 10-day vest: There is only 0.4% claimable in the first hour. Claim on day one and you'll get 10% but have leave the rest. Wait until day ten, you get 100% plus a share forfeited by those who claimed early. The weak hands subsidize the diamond hands. Same mechanic works for 10 week or 10 months vesting. Conviction can be extended.
Each holder has different circumstances. Someone who needs liquidity early should be able to access it. If it has pumped 20x, it's still a 2x in a day. Diamond hand claims allow ownership without coercion: you can leave if want, but the cost of leaving decreases with patience.
Impatient capital exits, leaving behind tokens for loyal. By the end of the vesting period, the remaining holders are, by definition, those who chose to stay. No one is locked in. Everyone made their choice. No need to short.
The chart looks different. The liquidity dynamics are different. The post-vesting holder table is composed entirely of believers.
Factory Deployment
Traditional token launches happen in phases. Deploy the token. Run a presale. Deploy the liquidity. Burn the LP. Send out tokens. Maybe do a farm. Each step is a promise. Each promise can be broken.
Ponzu deploys eight contracts in a single transaction: Token, Presale, Launcher, Distributor, LPs, Farm, NFTs. One button. One transaction. Token engineering as a service.
The "dev is ded" the moment that button is pressed. Not literally, but on-chain: nothing about the token distribution should depend on future developer actions. The smart contracts encode all the rules. Vesting schedule, fee structure, liquidity allocation, reward distribution. These are not promises. They are guarantees enforced by code.
Will they actually lock tokens? How will they distribute tokens in the multisig? With Ponzu, those questions are answered before the presale begins. The contracts are immutable. The parameters are fixed. The only remaining question is whether the project itself has value.
For founders, this is liberating. You are not managing tokens. You are working on product-market fit, as it should be.
Dynamic Swap Fees
When a presale completes and liquidity goes live, the first hour is chaos. Bots and snipers buy tokens the moment they are tradeable, expecting to dump on retail shortly after. In most launches, this value accrues to extractors.
We made extraction increasingly unprofitable.
Ponzu charges a 20% fee on swaps during the first hour after launch, decaying linearly to a 1% fee. A tax on speculation in a potentially undervalued new token.
The fees do not disappear. They flow to the Distributor. Early speculation subsidizes long-term holders. Projects launch into a market that rewards waiting rather than rushing.
The Distributor
Every protocol needs to decide how to allocate revenue. Most make this decision once, at launch, and it never changes. Some do not bother at all. Ponzu's Distributor makes this decision dynamically based on conviction.
After launch, token fees are split dynamically: 44% to presale holders, 44% to farm, the rest to the project and protocol. As presale participants claim their tokens, their share decreases and the farm's share increases. If the last person claims from the presale, the allocation shifts to 0% presale, 88% to the farm.
The presale allocation provides rewards to believers during the vesting period. But they can claim only once, continuing to reward an empty presale pool would mean burning value. Instead, as the presale empties, its allocation shifts towards the farm.
Even after vesting, presale card holders who dont claim, earn lifetime rewards from the distributor. ETH rewards sent to the Distributor can be claimed any time, but project tokens can be claimed only once. The system adapts to the current need without governance votes or admin intervention.
The farm extends the alignment horizon beyond the initial vesting period. After vesting completes, there is natural sell pressure from holders who waited but are ready to exit. The distributor gives both the presale and farm a reason to stay: earn non-inflationary rewards from fees.
Conviction is extended. You can only claim once.
Non-Inflationary Farming
Inflation-based farming destroy projects in 2021. Mint new tokens, distribute to stakers, call it "yield." The problem is obvious: you are diluting existing holders to pay new ones. Industrial farming bots took this further, constant sell pressure, another death by a thousand sells.
Ponzu's farm distributes rewards from actual economic activity. Swap fees. Diamond hand early claims. Penalties from early farm exits. Real revenue, not printed tokens.
The farm has its own conviction mechanism: Claim ETH anytime, but you can claim project tokens only once. Unstake your LP before 7 days, leave a portion of your LP behind. Half of that forfeited LP goes to remaining stakers. The other half becomes protocol owned liquidity. Same principle as diamond vesting: impatient capital subsidizes the loyal.
For founders, this means if volume grows, rewards grow. The feedback loop is honest. Projects succeed or fail based on real usage, not tokenomic games. There is no governance vote that can inflate your way out of problems. Just conviction.
Kioke Barrels
Kioke are the cedarwood barrels used for fermenting traditional ponzu sauce. Some have been in continuous use for over a century. The fermentation culture Koji, lives in the wood and enriches the flavor.
We need a new way to set the culture.
As the factory runs, Koji accumulates in every barrel. One credit per launch. Hold your barrel for a hundred launches, you'll have a hundred credits. Use them to vote on the projects that matter to you. Your choices become your track record. Back winners, your signal strengthens. Founders notice. Communities follow.
As with every choice, there are rewards.
A percentage of each project's token rewards go to the Kioke pool. Vote for a project with your Koji (credits), earn a share of its rewards. You could vote one Koji and earn a fraction. Or you could stack all your Koji on a token you believe in.
Conviction pays.
The Complete Picture
Each mechanism reinforces the others. Refunds allow ambitious launches. The factory makes them trustless. Diamond vesting filters for conviction. Swap fees protect from snipers. The Distributor routes tokens to aligned participants. The farm extends conviction beyond vesting. All within a fixed supply that makes the economics sustainable.
This is conviction infrastructure: every design decision assumes participants will act in their own economic self-interest, and structures incentives so that self-interest and collective benefit align.
Token launches do not have to be casinos. They do not have to be zero-sum games between insiders and retail. With the right mechanism design, they become coordination tools that fund real projects and reward real believers.
A bad batch brewed longer is still a bad batch. But good ingredients, proper process, respect for time, now that produces something worth waiting for.