Bread

Bread $BREAD

N/A

Breadchain is a decentralized cooperative that connects post-capitalist web3 projects through blockchain-powered mutual aid. Its flagship application, Bread Crowdstaking on Gnosis Chain, allows users to stake xDAI to earn yield and receive BREAD tokens. These tokens grant voting rights to allocate interest earnings to member initiatives, such as worker DAOs and community currency tools; a unique trait for a token akin to a stablecoin.

Stablecoin
Bread postToken Page

Bread token design description

TL;DROoVVCMVCIP

Value Capturing Mechanisms

Value transfer from Representation Token (Breadchain)=[5][1]\text{Value transfer from Representation Token }(\text{Breadchain}) = [5][1]
Value transfer from Representation Token={V={5,1}E={(5,1)}}\text{Value transfer from Representation Token} = \left\{ \begin{aligned} V &= \{5,1\} \\ E &= \{(5,1)\} \end{aligned} \right\}

1. VALUE TRANSFER FROM REPRESENTATION:

 Origins of Value: Representation(5) Value Transfer(1)\text{ Origins of Value: } \text{Representation} (5) \text{ Value Transfer} (1)

This VCM captures the combined value derived from the stability and utility of BREAD, a cryptocurrency minted using xDAI through the Crowdstaking platform’s mint-and-burn-mechanism. The stability derived from the predetermined exchange rated, enforced by smart contract, contributes in eliminating price volatility, providing holders with a dependable method to enter or exit the ecosystem. The trust and predictability in this exchange process form the foundation of BREAD’s intrinsic value, which reflects the Representation origin of value.

This stable intrinsic value directly enables BREAD’s role as a functional currency within the BREAD Marketplace. The Value Transfer origin of value emerges from this utility, as BREAD’s worth is enhanced by its practical applicability in real-world transactions. To clarify, the intrinsic value of BREAD is the stable, designed value derived from its fixed representation of xDAI, enforced by smart contracts. In contrast, the market value is the price at which BREAD is traded in the open market, determined by supply and demand. For BREAD to effectively serve as a medium of exchange, its market value must remain closely aligned with its intrinsic value. This alignment is maintained through the representation mechanism, which ties BREAD’s market value to xDAI, and the two-way redemption process (minting and burning), which corrects any deviations, ensuring the market value consistently reflects the intrinsic value.

govToken(Breadchain)=[8][3]\text{govToken}(\text{Breadchain}) = [8][3]
govToken={V={8,3}E={(8,3)}}govToken = \left\{ \begin{aligned} V &= \{8,3\} \\ E &= \{(8,3)\} \end{aligned} \right\}

2. GENERALIZED GOVERNANCE:

Origins of Value: Conditional Action(8) Governance(3)\text{Origins of Value:} \text{ Conditional Action}(8) \text{ Governance} (3)

This VCM embodies the value derived from the governance rights granted to BREAD holders. By holding BREAD and participating in voting (Conditional Action), holders can influence the ecosystem’s resource distribution, such as directing interest earned from sDAI to supported projects (Governance). This governance power enables holders to shape the ecosystem’s priorities and fund initiatives, which is where the value originates. The value capture is explicitly tied to active participation, with benefits accruing to those who engage in decision-making and those affected thereof.

Economic Summary

The BREAD token anchors the Breadchain ecosystem by tying its value directly to xDAI, a stablecoin on the Gnosis Chain, through a “bake-and-burn” process. This stable foundation allows BREAD holders to redeem their tokens for xDAI at any time. The underlying xDAI is deposited to sDAI and generates yield used for Breadchain cooperative activities.

Additionally, BREAD functions as a medium of exchange in the BREAD Marketplace, facilitating transactions for goods and services among a network of supporters. Beyond this, BREAD unlocks governance capabilities, enabling holders to vote on the allocation of yield generated from sDAI to projects within the network.

Bread captures value through two primary value capture mechanisms: Value transfer from Representation: BREAD is minted and burned at par with xDAI (Representation), via smart contracts such as 'Bread.sol'. This stable value allows BREAD to serve as a reliable medium of exchange (Value Transfer) in the BREAD Marketplace, enabling transactions for goods and services supported by partners like Giveth and Crypto Commons Association. Generalized Governance: Bread holders can vote (Conditional Action) on allocating yield generated from sDAI to various projects within the Breadchain ecosystem, directly influencing (Governance) resource distribution. This governance power, facilitated by contracts such as 'ButteredBread.sol' and 'YieldDistributor.sol', endows BREAD with utility value in its ability to allocate financial resources to the most impactful projects.

The above mentioned value capture mechanisms can be each formulaically described as:

Value transfer from Representation=[5][1]\text{Value transfer from Representation} = [5][1]
Generalized Governance=[8][3]\text{Generalized Governance} = [8][3]