What is Towns (TOWNS)?

Deep Dive

1. Purpose & Value Proposition

Towns Protocol addresses centralized control in messaging platforms by enabling user-owned Spaces—on-chain environments where communities set rules, monetize interactions, and manage memberships via NFTs. It combines end-to-end encryption with programmable features like staking-based access and reputation systems.

The protocol generates revenue through ETH fees from activities like membership sales, which fund a buy-and-burn mechanism to balance token inflation from node rewards.

2. Technology & Architecture

• Layer 2 Infrastructure: Runs on Base (Ethereum L2) for low-cost transactions and Towns Chain (Celestia-based) for scalability.
• Stream Nodes: Decentralized off-chain nodes handle encrypted message routing and validation.
• Smart Contracts: Manage Spaces, governance, and tokenomics (e.g., staking rewards distributed via DAO-controlled contracts).

3. Tokenomics & Governance

• TOWNS Utility:
  
  • Staking: Secures the network via proof-of-stake.
  • Governance: Holders vote on protocol upgrades via Towns DAO.
  • Delegation: Assign tokens to Spaces for features like custom pricing or storage.
• Supply: Initial 10.1B tokens, with controlled inflation (max 15.3B over 7 years). 57% allocated to community incentives, 21% to the team, and 13% to investors.

Conclusion

Towns Protocol reimagines digital communication by merging blockchain’s ownership benefits with real-time messaging. Its tokenomics prioritize decentralized governance and sustainable growth. Will Towns’ focus on user sovereignty and on-chain monetization redefine how communities interact in Web3?