The utility token that powers the Galileo Protocol ecosystem is called LEOX. It was first issued and launched during an Initial Coin Offering (ICO) crowdfunding event, which will take place between July 2022 and Q1 2023. The LEOX token is used to access the Galileo Network’s service and is not an investment vehicle by design.
LEOX is a QRC-20 utility token issued on a multichain protocol (currently supporting Ethereum, Polygon, and XDC). It’s our ambition to create a digital currency that you can use on the internet to interact with physical assets and our pNFTs.
The LEOX token is used within the Galileo ecosystem to provide users with discounts on trading fees, access to new NFTs launched, pay enterprises’ licenses, and, eventually, fair voting on decisions concerning the protocol's future.
Users can use LEOX to pay for pNFTs and services, settle transaction fees on the Galileo marketplace, and in the future, vote on decisions concerning the protocol's future, participate in exclusive pNFTs sales, and more.
LEOX has different functions for the community:
To use the platform, brands, resellers, and enterprises must purchase bi-annual licenses with LEOX tokens. The license fees are denominated in FIAT, and enterprises can choose if they want to use this service or pay with LEOX. Naturally, the number of tokens needed will vary depending on the price of LEOX. The Galileo Treasury converts the licensing fees paid into the equivalent amount of LEOX. Thanks to the treasury conversion service, enterprises don’t have to worry about purchasing $LEOX directly from exchanges, as the treasury handles that for them. An Oracle solution provides the current rate for USD/EUR to LEOX conversion.
The LEOX purchased for the bi-annual licenses are locked up in a smart contract for six months, reducing the tradable supply and token velocity of LEOX. After six months, the license expires, and the locked LEOX moves to Galileo’s Treasury. This creates a constant demand for LEOX as the platform grows.
Enterprise license fees will be determined based on:
A percentage of all exchange fees collected by Galileo Protocol is used to buy LEOX and put them into the vault. More products and services will utilise LEOX in the future. As platform usage increases, so will the demand for LEOX.
LEOX vaulting is a mechanism to permanently take coins out of circulation, reducing the total available supply. Many cryptocurrency projects perform periodic coin vaults to create a deflationary effect.
Vaulting LEOX strengthens the Galileo ecosystem by slowly and steadily removing some LEOX from circulation. Galileo will display the amount vaulted, increasing transparency and characterising us as a regulatory-compliant marketplace. Anyone can review the transactions as they are publicly recorded and verified by peers on the blockchain.
LEOX adopts two coin-vault mechanisms, reducing its total supply by 25% in the long term. The first mechanism involves vaulting a portion of the LEOX buyback from transaction fees on the Galileo platform. The second mechanism consists of an annual LEOX vaulting event.
The annual LEOX vaulting is not based on the LEOX trading volume on the Galileo marketplace. LEOX vaulting will automatically adjust the vault amount based on LEOX’s price and supply-demand dynamics. This mechanism offers greater transparency and predictability to the Galileo community.
If the LEOX price drops, the amount of $LEOX vaulted will increase.
Once the total tradable supply of LEOX falls below 150 million, the two vaulting mechanisms will stop.
In a few years, Galileo will deploy a decentralised autonomous organisation (DAO) on the blockchain, enabling users who are staking LEOX to exercise governance over the protocol.
By staking, users gain governance, and as a result, they can coordinate themselves in a decentralised manner through self-executing rules.
The specific problem that Galileo Network will focus on is the voting procedure within DAOs and how it can be made fair. Fair in the sense of making it as democratic as possible or equalising everyone’s vote weight as much as possible.
The problem with traditional DAO projects is that 1% of all holders have 90% of the voting power. There is a high concentration of decision-making power in the hands of a selected few. To Galileo, this distribution is unacceptable, and we will do whatever it takes to prevent this from happening.
Galileo Network will use a voting system based on Quadratic Voting to solve these problems. Quadratic voting is a fascinating and effective solution because it drastically reduces the voting power of a significant LEOX staker compared to a smaller LEOX staker.
A few simple examples of how this would work:
• 1 LEOX token = 1 vote.
• 25 LEOX tokens = 5 votes.
• 100 LEOX tokens = 10 votes
As mentioned above about Quadratic Voting, it does open up a significant vulnerability to Sybil attacks. Attackers can create multiple wallets and bypass the reduction of votes.
In addition to Quadratic Voting, we will implement Conviction Voting as a voting system to let time factor in how much influence a member has, which is fair in some cases. With this mechanism, the voting period is not within a small window but recorded over time.
LEOX stakers vote on a proposal, and the longer they keep their voted stakes, the more their voice will grow, and they will show a greater conviction towards the proposal.
This appendix provides some background on the challenge of combating trade in counterfeit goods, including the magnitude of the problem and its detrimental societal impact.
NFTs are cryptographic tokens that reside on the blockchain. They are non-fungible because they each have an identifier, making them unique, immutable, and distinct. NFTs are traceable because they are on a distributed ledger. Anyone with access to that blockchain can verify the ownership and status of each NFT.
The term pNFTs refers to ‘physical Non-Fungible Tokens’, tokenised physical assets. Tokenisation is possible with almost anything where ownership is an essential factor (real estate, luxury watches, cars).
With tokenisation, we certify that the physical asset is authentic and guarantee its origin. This process takes place on a public blockchain, allowing us to create an ownership history log.
The pNFT is a digital twin of the physical object to which it is linked. It provides all the advantages of an NFT (unique, traceable, immutable, and secure) while abstracting much of the complexity involved in trading a physical asset. pNFTs are a solid response to a fundamental problem in the luxury goods market: counterfeiting.
pNFTs are used in supply chain management and asset authentication to track physical assets, such as luxury goods, to circumvent counterfeiters or help artists own and better manage the intellectual property of their creations.
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