What is Towns (TOWNS)?

Deep Dive

1. Purpose & Value Proposition

Towns Protocol decentralizes social communication by replacing centralized platforms (e.g., Discord) with user-owned "Spaces." Each Space operates via smart contracts, letting creators set rules, monetize memberships (ERC-721 NFTs), and enforce encrypted messaging. This shifts control from corporations to communities, enabling censorship-resistant interactions and direct economic incentives for growth (Towns Whitepaper).

2. Technology & Architecture

The protocol uses a modular stack:
- EVM-Compatible L2: Built on Celestia for scalability, handling smart contracts and state changes.
- Decentralized Stream Nodes: Off-chain nodes validate and route encrypted messages.
- Base Smart Contracts: Govern memberships, staking, and fees on Ethereum’s Layer 2.
End-to-end encryption (Curve25519/AES-GSM) ensures privacy, while on-chain NFTs manage access.

3. Tokenomics & Governance

• Supply: Initial 10.1B tokens, with 57% allocated to community incentives and 35% to team/investors (vested).
• Utility: $TOWNS secures the network via staking, enables delegated governance (voting launches in 2026), and unlocks premium Space features.
• Inflation: 8% annual inflation at launch, declining over seven years, with ETH fees used for buybacks to offset dilution.

Conclusion

Towns Protocol reimagines online communities by merging decentralized messaging with Web3 ownership models. Its EVM-compatible architecture and token-driven governance aim to empower creators and users alike. Can programmable Spaces achieve mass adoption while balancing decentralization with usability?