Jun 8, 2021
All you need to know about the swap of the KICK v8 token and its burning process
We have collected the most popular questions about the process of token burning and the KICK token swap
It is worth noting that significant changes will take place within the Kick Ecosystem tokenomics, as well as with the KICK token, during the upcoming month. All these changes are required to implement a hyper-deflationary model and allow users to significantly increase their benefits from owning KICK tokens. In this article, we have collected the most popular questions about the process of token burning and the KICK token swap and will provide you with detailed answers.
What is KICK token burning? When will it happen?
First of all, you need to understand the difference between token burning and token swap. Token burning is the irrevocable destruction of a certain number of tokens. This KICK token burning procedure won’t affect the tokens stored in our user’s wallets. Only coins held in the company’s accounts will be subject to this destruction. The critical purpose of burning is to reduce the available amount of tokens in circulation.
Token burning will take place on June 15, 2021. We are going to burn 85% of all issued KICK tokens without the possibility of their recovery. Such an approach will significantly reduce the number of tokens in circulation, increasing their value among holders and the percentage of tokens in possession of users relative to the total number of available tokens.
During token burning, the following will be destroyed:
- Test KICK tokens, which were created earlier for various experiments;
- Company tokens that were received in the form of trading fees from our users.
Here is an example:
Let us imagine that we have a total number of 10,000 tokens. Holder A has 200 tokens, while the company owns 9,000 tokens. Thus, the holder owns 2% of the total token amount. Now, let us imagine that the company burns all of its 9,000 tokens. As a result, the total amount of tokens is now 1,000. It turns out that Holder A owns 20% of the entire amount, while the value of their assets increases!
It is also worth noting that users do not have to perform any actions during token burning since it will only affect the company’s tokens.
What is a token swap, and why is it important?
First of all, the token swap replaces an existing token smart contract with a new one. This will entail changes in the total amount of tokens, their nature, the method of issue, circulation, and much more. This procedure will affect both company’s and user’s tokens and will occur according to the rules listed below.
The swap between the KICK and KICK v8 tokens will take place on July 1, 2021. On this date, we will completely replace the current version of the smart contract with a new one.
Why does the Kick Ecosystem perform the swap of the KICK token:
- This is the only way to destroy the current emission method from the token. In addition, such an approach allows limiting the overall number of tokens, thus making the token more attractive and safer for large holders;
- In addition, exchanges can be sure that the holdings of their users won’t be diluted via the sudden emission of new tokens, consequently making the KICK v8 token more attractive for listing;
- This is the only way we can add staking features and distribution of tokens to holders and burning;
- In addition, we are going to perform a denomination during the swap, thus removing two zeros from the circulation amount. Here is an example: Let us imagine that the price of the KICK token is $0.003. After the denomination, the value of the token will be $0.3. This will not affect the value of the assets in dollar terms. In other words, if you previously had 10,000 tokens equal to the amount of $10, you will receive 100 tokens equal to the amount of $10;
- Such an approach allows increasing the reputation and trust of the KICK token among holders while attracting new users and expanding the community;
- Staking features will be implemented in the new smart contract. This will make the token more attractive for holders, while selling will not be tempting, thus positively affecting the demand for the KICK v8 token.
What will happen if the price is not going to increase proportionally after the swap?
This means that the traders, who understand all the features of the token economy, will have the opportunity to buy new KICK tokens a hundred times cheaper and increase their total share for further staking opportunities. Such tokens will be immediately purchased, and the price will return to its natural value. We expect that the price of the KICK v8 token will adjust after the swap, as the number of KICK v8s in circulation will decrease by 100 times, and the value of the remaining tokens in circulation will increase proportionally. This is the key principle of the denomination. Now, imagine that you have decided to sell you tokens. If you would use the old price, which would be $20/100, you would sell your 10% of emission for $0.2. Will you do it? Will anyone do it? How do you think, will other people NOT buy your 10% of emission for this price, which is x100 times cheaper?
What are the key stages of the token swap?
- On July 1, 2021, at 9:00 AM UTC (12:00 Moscow time), all transactions within the current version of the KICK (v7) smart contract will be stopped forever;
- An analysis of all addresses in the Ethereum blockchain will be performed to determine how many tokens are stored on the addresses and what kind of addresses they are;
- All wallets that hold KICK tokens worth less than $20 will not be taken into account. This is important — if you own less than $20 in tokens, wherever you keep old KICK v7 tokens, you will not receive new tokens;
- All wallets that hold KICK tokens worth less than $100 and that are not held on the KickEX exchange will not be taken into account. This is important for those who do not have old KICK v7 tokens on the KickEX exchange. In this case, you will not receive v8 tokens;
- All addresses that hold KICK tokens worth more than $20 and which are held on the KickEX exchange, as well as all addresses with more than $20, will be selected, and distribution of new KICK v8 tokens will start at a ratio of 1: 100 (one KICK v8 token for every 100 old-style tokens);
- For KICK tokens that are not held on the KickEX exchange at the time of the swap, the distribution can take place a few hours or even a few days or even weeks if the cost of gas in the Ethereum blockchain is high;
- Thus, users who hold KICK not on the KickEX exchange for amounts over $20 will gradually receive new tokens;
- First of all, the new KICK v8 tokens will be received by those who have the most old KICK tokens on their balances;
- To get new tokens immediately, keep them on the KickEX exchange!
- Those who received new tokens will immediately be able to use them: transfer, trade, and so on;
- During the swap, a reserve pool will be created in the amount of 10% of the entire circulation for unforeseen situations. In 2022, when we will make sure that everything is in order and everyone received the new KICK v8 tokens, the pool will be destroyed.
What will happen to the frozen tokens and tokens received for participating in the referral program?
FrozenDrop: for tokens that remain frozen at the time of the swap, no accrual of KICK v8 tokens will occur. In other words, the frozen tokens will not be transferred to the new token. Thus, 1.2 trillion frozen KICK tokens will be destroyed, which will have a positive impact not only on the KICK token’s reputation but also on its perception by the audience. By burning the frozen tokens that have fulfilled their purpose, we are reducing the overall emission, not by 85%, but 95%!
We discussed the possibility of a post-swap defrost mechanism that would allow users to unfreeze and exchange their old frozen tokens for new ones. However, we decided that the supply of new tokens that would be unfrozen conflicts with the concept of the deflationary KICK v8 model. Therefore, with a 90% probability, frozen KICK tokens will remain forever in the past. If there will be a high demand for unfreezing old tokens and if we will find a way to unfreeze them without harming the deflation concept, then we will implement a special mechanism closer to the end of 2021.
All referral KICK tokens that were credited as a reward for inviting new users will be converted to $REF synthetic tokens after the swap. They will have the same purpose in the KICK Ecosystem — reducing or paying trading fees. Such a substitution is required to separate deflationary tokens from referral bonuses and to ensure that referral bonuses won’t be destroyed. 1 $REF will be equal to $1, while the conversion will be carried out taking into account the funds that users have credited to the ecosystem account. As a result, users who deposited KICK tokens into their accounts will not lose their funds.
What will happen to the liquidity on Uniswap during the KICK swap?
During the swap procedure, liquidity will be withdrawn from Uniswap and returned immediately after substituting the old token for the new one.
What do users need to do during the KICK v8 token swap?
To receive new tokens during the swap, you must meet one of several conditions:
- In all cases, you must hold tokens for the amount of not less than $20 at the average market rate or higher. If you are a holder of KICK tokens worth less than the equivalent of $20 at the time of the swap, new tokens will not be credited regardless of where you hold your tokens. We are forced to do this because of the current gas prices on the Ethereum blockchain. Otherwise, the swap will cost hundreds of thousands of dollars. In this case, if you want to get new KICK v8 tokens, then you can either buy more KICK tokens so that their value exceeds $20 (and it is better to do this with a margin) or sell your tokens. People looking for ways to increase their portfolio for subsequent staking will be happy to buy them from you;
- KICK tokens for amounts less than $100 will receive new tokens only if they are held on the KickEX exchange;
- Holders of KICK tokens worth $100 or more will receive new KICK v8 tokens regardless of whether they are on the KickEX exchange or not. If you prefer keeping your tokens in wallets or other exchanges, we recommend transferring them either to KickEX or keeping them on cold wallets, such as MyEthetherWallet, Trezor, Ledger, and Metamask;
- We are not aware of how Trustwallet or Coinbase, or their counterparts work! If you keep your tokens on these platforms, you need to contact their Customer Support. Their experts will tell you whether you can get new tokens or not. We are not responsible for the operation of third-party wallets. Please note that you bear the entire responsibility for the safety of your coins if you store KICK tokens there;
- Rule of thumb: During the swap, you need to keep the tokens on the KickEX exchange. By doing so, you will receive new tokens instantly, and you will not have to wait for new tokens!
- We understand that citizens of the United States, Canada, and Iran cannot use the KickEX exchange. Unfortunately, we cannot accept your funds even during the swap, as the EU and US laws do not allow this. We recommend using cold wallets, while MyEtherWallet is the proven and the most reliable option!
- HitBTC and STEX exchanges. Currently, we are waiting for confirmation that they will support the swap. We will announce the results of the negotiations closer to the start of the swap.
Other questions about the KICK v8 swap
Q: Is KICK v8 an ERC-20 token?
A: Yes, this is an ERC-20 token created in the Ethereum blockchain.
Q: 5% burning and 5% distribution results in 10%. Isn’t that too much? Aren’t you afraid that all transactions will be simply paralyzed?
A: We are aware of this probability, so these values can be changed in the smart contract. If it turns out that this price is too high, then we will decrease it from 5% to 3% while observing the dynamics of transactions.
Q: I am not able to use KickEX. How can I make sure not to miss the swap?
A: Use www.myetherwallet.com. It is a 100% reliable, trusted, and secure solution. You can also use such cold wallets as Metamask too.
Q: When will the swap start?
A: All transactions with the current version of Kick token will be stopped at 9:00 UTC (12:00, Moscow time), and the wallet analysis will be commenced. We predict that the distribution of new tokens will begin at 12:00 UTC (15:00 Moscow time).
Q: How long will the swap take for those who hold tokens on KickEX?
A: If you hold tokens on the KickEX exchange, you will receive new tokens almost immediately at the moment of the swap. But, since it will be necessary to carry out several technical improvements and changes on the exchange itself, we assume that this work will take about an hour. In an exceptional case, the swap may be delayed for one day.
Q: How long will the swap take for those who do not hold tokens on KickEX?
A: It may take from a few hours to several weeks, depending on the cost of gas and the workload of the Ethereum blockchain.
Q: Who pays the commission in Ethereum for the swap?
A: The commission is paid by Kick Ecosystem. That is why the distribution of new tokens may take more than few hours. If the gas price is too high, we will have to wait until it drops.
Q: Do you plan to use BSC and have KICK v8 token supported on it?
A: No. We strongly believe in the bright future of Ethereum 2.0, and we do not want to leave this blockchain no matter how long its development takes. It is worth waiting, and we strongly believe that all other blockchains won’t be able to compete with the new version of the Ethereum blockchain. Therefore, KICK will remain on the Ethereum platform until we create our own blockchain. It will not be worse than Ethereum 2.0, and it will solve business problems that developers cannot solve despite the progressiveness of Ethereum.
Q: During the previous swap, holders received bonus tokens, which were frozen. What will happen to them?
A: After the official launch of the exchange, we provided our users with a clear and easy-to-use token unfreezing mechanism. It was available for almost a year. If you did not unfreeze your tokens, which could be done for a tiny fee, then you will lose all of them during the swap.
Q: What will be the final issue?
A: After the swap ends, the final issue will be 1.5 billion KICK tokens.
If you still have questions after reading this article, please allocate some time to reread it. If you still cannot find the answer to your question, you can talk with our support in our Telegram group: https://t.me/KickICO (En) or https://t.me/KickRussia (Ru).
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