Plasm Network uses PLM as its native token. However, Plasm Network, a Polkadot Parachain, can handle tokens from other chains such as DOT and ACA. Therefore, it would be very easy to use other tokens such as DOT to pay for gas. In this section, we propose to treat tokens other than PLM as gas and to provide the fundamental value of PLM.
PLM provides a reason for value by incorporating Lock and Burn mechanisms respectively.
- The PLM needs to be staked to select Collators, and the Collator with the highest amount of staking is selected and rewarded.
The Collator with the highest amount of staking will be selected and rewarded.
- The PLM needs to be staked to determine the reward to be paid to each dApps Protocol.
- The more dApps staked, the higher the reward.
- A portion of the PLM used for commissions will be burned, and a portion will be paid to the Collator as a commission fee.
The current demand for PLM tokens is based on the fact that staking PLM will increase the amount of PLM. Therefore, when a transaction fee is substituted for another token, the following process should be performed “Sell the DOT used as a fee to the DOT/PLM board on the DEX. Then burn some of the PLM obtained and pay some of it to the Collator as a commission fee.” In this way, we can build a structure in which PLMs are bought and supported by other tokens.
The PLM is an inflationary currency, but thanks to the Burn mechanism, it can be bought regularly and also act as a deflationary force. This is the fundamental value of the PLM. In addition, PLMs can be increased by staking, which attracts speculative demand. As a result, the value as a reward can be secured continuously.