We @BaselineMarkets have been hard at work to solve the central problem every token creator faces: “How do I set my token up for success, to have as much positive price action as possible?” or in other words “How do I make numba go UP??” Healthy price action is a result of strong demand matched with reliable and available supply. DeFi has created mechanics to help manage supply and provide utility to stimulate demand, but they often fall flat. Success is the exception rather than the rule. And we believe the culprit is poorly designed liquidity. Let me explain Post TGE is where the real challenges of managing a token begins. In an effort to help token performance, creators rely on well established mechanics used in DeFi, whats lovingly referred to as ponzinomics. Fee shares, pool2, ve locks, buyback-and-burns, etc. These are all forms of supply control, where circulating supply is locked away or burned to prevent selling. Supply control is how cabals in memecoin szn were able to make millions. Its how Curve and other ve-locker tokens have survived for over 5 years despite continuous emissions. And conversely, its why so many tokens completely fail. Many of these problems stem from excessive supply being created and mismanaged. Creators emit tokens in order to stimulate growth, using methods like LP incentives, points programs, airdrops, etc. And this is on top of vesting supply for investors. For exceptional projects with strong demand, the mentioned supply control mechanics have worked to absorb this excess to create thriving tokens. But these are the minority. The truth is, creating supply is much easier than controlling it. The cost of these actions are often misunderstood, and there's a vast graveyard of tokens to show for it. A lot of thought goes into creating these controls, but very little goes to the liquidity pool its designed to protect. Liquidity is often paid for, via LP incentives or private deals. The thought is, incentives and the free market should take care of liquidity needs naturally. But this is wrong. Liquidity is inherently mercenary. Incentives do not guarantee it, nor can you know if it'll be there when you need it most. Providing liquidity is a risky and complex problem, especially for new tokens. It's why market makers cost an arm and leg to provide their services. And worse, all of the fancy ponzinomics can end up useless. If liquidity leaves, the price action becomes unstable. No amount of supply controls can prevent it. Creators then have a dilemma. How do you grow a project without eviscerating the token? Baseline is designed to solve this dilemma. Our answer is simple: have each Baseline pool create its own liquidity, owned by the token so it never leaves the pool. Every bid contributes to the Token-Owned Liquidity (TOL), distributed across the floor (Baseline Value or BLV) to the top-of-book, and it stays in the pool, guaranteeing an exit. Creating stable, permanent liquidity allows us to create our own version of the supply controls we desire. - Staking: A basic fee share mechanism for holders. All holders can stake their tokens for a share of the LP fees the pool generates. This gives tokens fee sharing “for free”. - Lending: BTokens can be collateralized to borrow the floor value (Baseline Value or BLV) as a non-liquidatable loan, while getting an option to repay and regain their collateral at any time. This acts like a better form of token locks. No need to lock holders for 4 years, let them borrow their backing while keeping price exposure. - Buyback-and-Burn: Using the native lending, Baseline's Afterburner is a leveraged buyback-and-burn. Any fees that a creator chooses can be used in a buy-and-borrow loop, then burned off in the end. This multiplies the effectiveness of traditional buyback-and-burn systems. The beauty of these tools is how they intertwine. Every collateralized BToken is staked, earning yield. The leveraged buybacks are only possible via the native lending. And every dollar of fees generated or tokens burned increases the BLV, allowing lending at higher LTVs and a higher floor price for all holders. Best of all, these features are safe. The Baseline AMM guarantees the floor will hold, and liquidity will remain in the pool. And every feature is available for every Baseline token from day one. DeFi mechanisms are a core part of the innovation of crypto. The promise is that a builder can launch a token for their project, experiment with token designs or just FAFO with a memecoin. But growing a project in crypto has inherent challenges, and the current AMMs, mechanisms, and liquidity solutions have failed to address this. The established methods just don't work for so many cases. What creators and traders need are guarantees. Enforced in code. Running onchain. Designed to solve their problems. This is Baseline. The new Mercury AMM upgrade is coming soon. Stay tuned.