Waves (WAVES): tokenomics, risks and score
An early smart contract platform whose associated algorithmic stablecoin and lending protocol collapsed in 2022, taking most of the ecosystem with it.
What Waves is, and what it does
This is a base blockchain. It runs and secures its own network, and its token is what you pay to use that network and what secures it.
What the WAVES token itself does: It can be staked to earn rewards, though a large part of those rewards is newly issued token rather than earned revenue.
Where it runs: Waves. Mechanism: Leased proof of stake. It has been running since 2016, so roughly 10 years.
The facts
- TICKER
- WAVES
- SECTOR
- Layer 1
- CHAIN
- Waves
- LAUNCHED
- 2016, so around 10 years of operating history
- MECHANISM
- Leased proof of stake
- MAXIMUM SUPPLY
- No hard cap following changes to its issuance
- VALUE CAPTURE
- Staking only
- UPGRADE CONTROL
- Team controlled
- VESTING
- Complete
- LIQUIDITY BAND
- Micro cap. Thin, often a single venue or pool. Treat the quoted price as indicative only.
How the score breaks down
Each dimension is explained on the directory page, and the reasoning behind it is taught in the Academy research process.
Supply and value capture
High ongoing issuance. New tokens are minted continuously and holders are diluted unless they participate. Holders can stake to earn rewards, though much of that reward is newly issued rather than earned revenue.
The founding team retains control over upgrades or parameters. Ownership is heavily concentrated. A small number of wallets hold enough to determine the price on their own.
Where it is strong and where it is not
- Has operated for around 10 years and through at least one full bear market
- Audited, with published reports
- Fully open source, so the code can be independently reviewed
- Vesting is complete, so there is no scheduled supply overhang
- Heavily concentrated ownership means a few wallets control the outcome
- High ongoing issuance dilutes holders who do not actively participate
- Upgrade control sits with a small group, so the rules can change
- Thin liquidity. Check order book depth before assuming you can exit
Incident history
The Neutrino USD stablecoin lost its peg permanently and the associated Vires lending protocol froze withdrawals, leaving substantial user funds inaccessible. Allegations of manipulation involving connected parties were widely reported.
Our read
The main risk
Its associated stablecoin failed permanently and its lending protocol froze user funds. The ecosystem has not recovered.
Before you buy anything
Check the contract address against the project's own documentation rather than a search result or a screener link, since impersonation tokens with identical names and logos are listed constantly. Check the order book depth before assuming you can exit at the quoted price. And write down what would make you wrong before you buy, not after. The Academy thesis module covers why that single habit protects more capital than any indicator.