Tokenomics of ELA


The Elastos main blockchain really only serves one function, being the trustzone to connect into the Elastos intranet. Looking at it from a sidechain’s perspective, the main chain also serves another more important function — to be the public ledger for all other side chains. The main blockchain doesn’t need to scale as it’s just storing simple hashes.

The sidechains are what allow other smart contracts like NEO, Ethereum, etc to run on top of elastos after porting their respective VMs(NEO VM, Ethereum VM). This is important as unlike other platform blockchains like ethereum etc which are trying to push millions of transactions through the blockchain (thus resulting in ballooning ledgers and scaling issues).

On elastos platform, the transfer of data such as videos, music, games goes through the decentralised secure P2P network called Elastos Carrier. The main chain is not cluttered with unnecessary data so there are no scaling issues.

Incentive for dApps to use Elastos does not come from an incentive to use the Elastos blockchain itself. dApps are incentivized to use the Elastos network operating system/P2P infrastructure and using elastos blockchain for decentralised IDs is a requirement to use that. And they may create their own sidechains for other tasks such as running smart contracts.

Utilities of ELA

  • Every sidechain on Elastos is tied to the main chain and the token in main chain(ELA) in some way. For example, if sidechains decide to merge mine on top of ELA which is then merged mined on top of BTC, this means that the transaction fees for all the dApps built utilizing these sidechains will have to be paid in ELA. One simple example is the DID sidechain that is merged mined with ELA. Any transactions recorded on the DID sidechain will need to be paid in ELA as a fee to the miners. This means, the more dApps and the more sidechains get built on top of the Elastos and the more traffic there is on the elastos ecosystem, there will always be a utility use case for ELA.
  • There are over 10,000 unique movies and over 2000 unique tv shows on netflix alone. Imagine creating 10,000 copies of each of the movies content creators want to sell on elastos platform. They would need to be paid with ELA for securing these digital assets which will utilize digital assets sidechain.
  • dApps will be paying in ELA for the services they’ll be using like Domain name registrations, search engines, page rankings, acquisition of UUIDs for digital assets, etc. They’ll all be using ELA which subsides for bandwidth, IPFS, etc
  • ELA will be the main currency that will be used to reward developers for creating dApps on the Elastos platform.
  • Apps built on elastos can implement their system to process transactions using ELA/SELA.
  • As part of the development efforts, around 16 million of ELA were exclusively reserved for the growth of elastos ecosystem development. These will be given to community members who contribute to the Cyber Republic. Anyone can contribute to the ever growing ecosystem of elastos: be it content creators, users, developers, testers, or leaders. More info is available at

Understanding the inflationary model for ELA

The total supply of ELA started with 33 million(as created in the genesis block). About half of 33 million are exclusively reserved for the Cyber Republic community.

Elastos also has a 4% inflation year to year. All the mining rewards come from this inflation. Because Elastos employs a AuxPoW + DPoS hybrid consensus mechanism, every time an ELA block is mined, the reward is distributed equally among the miners(35%) + stakers(35%) and Cyber Republic(30%).

The inflation is there to also account for all the ELAs that may be lost due to people losing their private keys or misplacing their digital wallets. It is estimated that around 4 million bitcoins have been lost and will never enter the circulating supply. In order to account for this similar loss, 4% inflation is employed by Elastos.

In addition to this, another reason there’s a 4% inflation also has to do with the fact that Elastos is an autonomous ecosystem that needs to keep on running. Bitcoin miners who decide to merge mine elastos are there for profit. There may be more than 6000 or even more than 10000 nodes running that help in the main ledger running autonomously with maximum security provided by the bitcoin network. It’s not only the elastos blockchain ledger that will be running autonomously but also the decentralized peer to peer network that will be running autonomously as well. In order to keep this wheel running for a long time, there needs to be miners for this as well who can provide supernodes as relays to transfer digital media content like video, music, games, etc. And these miners need to be rewarded as well.

Another way to look at the elastos platform is to imagine it being a self sustaining ecosystem. Elastos is building a smart web. A simple example of this is a micro-website(without an IP address) that will be running completely peer to peer. These micro websites need to have domain names, storage service and any other services websites need. All of these services will be paid with ELA. One thing to keep in mind is that proceeds from domain name registrations, etc will be used to fund hard drives(such as Hive), supernodes for relaying videos, music, etc. Everyone can provide these services and they’re all helping the ecosystem, so they’ll need to be awarded accordingly. This is a self running economy so there needs to be a currency with a healthy economic inflation that can provide a long term sustainment and an equal growth of the entire ecosystem as a whole.

Any existing smart contract VM may be ported to Elastos

Elastos provides a platform for any kind of dApps to be built that can run directly on the device instead of running on top of the blockchain itself like most dApps today. This creates an incentive to port existing VMs(eg. NEO, Ethereum, etc) from other blockchains to be run on top of elastos, thereby leading to the true interoperability between all the different kinds of blockchains all running under the same umbrella that provides solutions to three of the most common problems faced today by most blockchains and dApps — scalability, security and decentralization, all without sacrificing anything in the process.


Testnet, Mainnet