Yesterday I wrote an article on the new utility token from FUNToken: $XFUN. In the article, I wrote what $XFUN is and why FUNToken need a new L2 utility token. For the sake of clarity, I updated the titles to "Part one" and "Part two" in a two-post series about FUNToken new L2 token $XFUN. In this post, I will write about the new infrastructure and mechanisms of the expanding ecosystem of FUNToken. And some thoughts about the potential upside of hodling $FUN right now (spoiler, I bought another $1,000 worth of $FUN earlier today at $0,03202, increasing my GAV a little - believing that interest for $FUN will pick up soon. Not FA).
As mentioned in part one, $XFUN will be pegged 1:1 with $FUN. The new token will be running in Polygon's multichain protocol. The purpose of this is to have a utility token which is better suited for online gaming activities, such as crypto sports betting for playing crypto casinos. $XFUN will have better performance, higher speed and much lower gas fee, without compromising security or integrity.
So, both $FUN and $XFUN will exist alongside each other in the FUNToken ecosystem, including the upcoming launch of the dPlay online casino. The new utility token is what will be used in such gambling dApps, where bets are placed and games are played. For players to use $XFUN in gambling dApps such as the dPlay Casino, $FUN tokens from the Etherum network needs to be swapped against $XFUN. Now, people probably worry about gas fees. It is important to note that they are building an XFUN Bridge in relation to the Polygon network. When swapping on the XFUN Bridge, you make a transaction of $FUN into an escrow account, where a minting process is executed, minting new $XFUN at a 1:1 (1 $XFUN = 1 $FUN) with the $FUN coins being swapped.
Effectively, the trading supply of $FUN will diminish at the rate of new $XFUN being printed. For every 1 new $XFUN, one $FUN is removed from the trading supply. This reduction is essentially a deflationary mechanism driving scarcity of $FUN coin. In an ideal world, the gaming dApps using $XFUN becomes popular and the demand for the Polygon-based token increases. As a result, the value of $FUN increases in relation to the decrease in circulating supply.
The FUNToken team will build a non-custodial wallet, essentially a vault, built to hold both $XFUN and $FUN tokens. The wallet app will work as the front-end, or user interface of the XFUN Bridge, where you can swap the tokens. The plan is to integrate FIAT payment options, I would bet on MoonPay among others where that users can purchase $FUN through, instead of transferring in a third-party DEX or CEX.
Another important function of the XFUN Wallet is compliance. Crypto gambling dApps needs to be licensed. Online gambling licenses are issued by regulatory bodies (such as the Curaçao license, MGA license or UKGC license). Not anyone can obtain such licenses, as they come with a long list of requirements. One of these is KYC (Know Your Customer), where a new player may have to prove their identity as part of signing up, depositing, or withdrawing money. The plan is for the XFUN Wallet to support such KYC requirements from regulators should an online casino operator need it.
In an old $FUN coin review, I wrote about the "new" Freebitco.in era of FUNToken. The Freebitco.in gaming platform uses $FUN in their rewards programme. As you may know, their platform boasts 46 million players worldwide. Out of those millions, there are currently 177,000 $FUN holders through the reward programme. Given that these are players, it is not unlikely that a large percentage of them would swap their $FUN in exchange for new $XFUN coins. As word goes, these hodlers will be encouraged to do so using the new XFUN Bridge to play in the new crypto gambling dApps such as the dPlay Casino and other future launches. Additionally, the crypto gambling dApps on their own should be working hard on acquisition to gain new players, who would have to buy $FUN, either through a CEX or DEX, or through the upcoming XFUN Wallet. The deflationary model will then decrease the circulating supply of $FUN as crypto gambling activities increase and more players swap for $XFUN tokens.