Seasons

Disclaimer: $SHELL is an on-chain asset and the token of MyShell. It did not exist before the TGE (Token Generation Event). Shell Coin, on the other hand, is an off-chain/point system created by MyShell to incentivize early participants prior to the TGE. During the TGE, $SHELL will be airdropped based on the amount of Shell Coin held, and the specific rules will be announced at a later time. We may use these two terms interchangably hereafter.

$SHELL Incentives Through a Seasonal System

$SHELL allocated for community incentives will be distributed to users through a structured "seasonal system." Each new season will feature enhanced functionality within our AI playground as well as presenting users with novel opportunities to earn rewards.

To continually engage and motivate all users to participate in shaping the direction of the MyShell platform, Shell Coins are distributed to users through various incentive mechanisms within each season. This includes:

• Exploration incentives, where users can earn tokens by interacting with and providing feedback on our platform offerings.

• Creation incentives, where tokens are awarded for generating innovative AI-native applications that push the boundaries of what's possible.

• Collection incentives, where tokens can be earned by accumulating in-platform assets, such as 'collecting' AI creations users believe hold great promise and potential.

Important note on Shell Coins vs Seasonal Points

Users may have noted the nuanced difference between Shell Coins, which serve as the underlying settlement currency, and Seasonal Points, used as the scoring mechanism. For simplicity, we refer to "Seasonal Points" earned through participation. However, Shell Coins always remain the ultimate settlement currency.

The conversion rate between Shell Coins and Seasonal Points is calculated for each season by comparing the total points generated to the Shell Coins to be released. This allows the rate to vary dynamically based on real user behavior versus planned token distribution each timeframe. By adjusting the rate seasonally, the model aims to ensure token allocations accurately reflect contribution levels over time, maintaining fair and robust incentives for continued community engagement and support of the MyShell platform.

Cross-Seasonal Distribution

Within a given season, the release volume of Shell Coins is tied to the developmental requirements of the MyShell platform. As a general policy, a faster pace of development within the season will correlate to greater token release.

During the early operations of the MyShell ecosystem, the seasonal Shell Coins release is positively associated with expanding the overall reach and engagement of the platform user base. In later stages, seasonal release will prioritize sustaining platform stability and rewarding long-term, loyal participants through enduring incentive structures. The goal remains to ensure Shell Coins release are strategically leveraged to progressively realize the MyShell vision.

Within-Season Distribution

The distribution rules for Shell Coins in each season vary. In principle, tokens are distributed based on contributions to the ecosystem, with specific rules determined by community governance voting, reflecting the platform's current strategic needs and development status.

For example, if the governance body decides that MyShell needs to attract more creators, a proposal can be made to increase incentives for creators in the new season's allocation.

The Artistry of Seasonal Systems

The seasonal release design approach provides a tokenomics framework well-suited for platform projects like MyShell. Compared to traditional linear unlocking schemes, seasonal unlocking achieves greater flexibility, upgradability and robustness.

Key Benefits explained:

• Flexibility: The total token supply is divided into isolated "seasons" with independently adjustable economic parameters. This compartmentalization provides localized controllability, where the distribution rules for a given season can be fine-tuned without affecting others.

• Upgradability: Seasonal rules can be adjusted over time in response to platform evolution. This future-proofs the economic model as new features are added.

• Robustness: Since each season operates independently, a risk in one segment does not impact others. This compartmentalization strengthens protection against single-point failures.

As MyShell integrates additional capabilities like computing power and content creation/distribution, a seasonal approach will facilitate regular assessments and refinements to continually optimize Community incentives. The segmented design concept enhances both stability and agility of the overall $SHELL tokenomics framework.