Sonic SVM Launch SONIC Token: Here’s the Details

Sonic SVM has officially launched its SONIC token. They introduce a restructured value model that is expected to deepen liquidity, incentivize long-term holders, and enhance alignment with the wider Solana ecosystem. 

The update replaces the previously used token burning model with a more dynamic buy-and-lock mechanism, designed to strategically manage supply and create sustained market demand.

What Is Sonic SVM and the SONIC Token?

Sonic SVM is the first Solana Virtual Machine (SVM) chain extension built on the Solana network. Known for powering decentralized applications, especially in gaming and social platforms, Sonic SVM plays a key role in processing attention-related on-chain activities. 

The platform now introduces SONIC, its native token, which serves multiple functions within the ecosystem, including governance, transaction fee utility, and liquidity incentives.

The launch of the SONIC token also marks a turning point in Sonic SVM's tokenomics strategy. By moving away from a pure burn model, the new approach focuses on creating tangible value for holders while actively supporting Solana's broader infrastructure.

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How the SONIC Token Value Model Works

The heart of this redesign lies in how transaction fees are managed. Previously, 50% of all fees collected on the Sonic SVM network were simply burned. Now, those same fees will be used to purchase SONIC tokens from the open market, which are then locked in a smart vault.

These locked tokens follow a 24-month linear vesting schedule, meaning they will not immediately return to circulation. 

This gradual release is intended to reduce supply while increasing market demand, creating ongoing buy pressure that supports the token’s value over time.

According to Chris Zhu, CEO of Sonic SVM, “This redesigned mechanism represents a fundamental shift in how we think about long-term token value. Rather than simply burning tokens, we’re implementing a strategic approach that builds liquidity and strengthens the ecosystem.”

Strengthening Liquidity and Solana Integration

Sonic SVM’s new model goes further than just locking tokens. A portion of transaction fees—specifically 12.5% labeled as SONIC fees—will be collected in SOL, Solana’s native token. These SOL tokens will be staked directly on the Solana mainnet.

The staking rewards generated will be paired with vested SONIC tokens to create liquidity pools on the Sonic SVM Mainnet. These pools will receive additional incentives to encourage participation from liquidity providers.

This dual structure supports the long-term availability and tradability of SONIC while reinforcing the protocol’s commitment to the Solana ecosystem. It also offers benefits to SOL holders through increased staking activity and more integrated use cases.

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Why This Matters for the Sonic Community

The launch and its accompanying value changes offer several benefits for users and developers within the Sonic SVM ecosystem:

• Sustained Token Value: By buying and locking tokens rather than burning them, the system applies steady demand and keeps inflation in check.
• Deeper Liquidity: Liquidity pools backed by protocol-owned assets ensure smoother trading and lower volatility.
• Solana Network Support: Staking SOL ties Sonic’s growth to Solana’s health, aligning community goals.
• Incentivized Participation: Rewards for liquidity providers help drive greater engagement from users.

Alan Zhu, co-founder and CPO of Sonic, emphasized the broader goal behind the move: “As we continue scaling our infrastructure to support millions of users, this mechanism ensures our token economy grows in tandem with network usage. The more the network is used, the stronger the buy pressure and deeper the liquidity becomes.”

Frequently Asked Questions (FAQ)

What is Sonic SVM?

Sonic SVM is the first chain extension on Solana’s SVM network. It enables developers to build applications focused on attention metrics, gaming, and user interaction on-chain.

What is the SONIC token used for?

SONIC is the native token of Sonic SVM. It is used for paying transaction fees, participating in governance, and providing liquidity within the Sonic ecosystem.

How does the new SONIC token model work?

Instead of burning tokens, 50% of transaction fees are now used to purchase SONIC tokens from the market. These tokens are then locked with a 24-month vesting schedule.