Tokenomics at STEPN

STEPN Official
10 min readMay 10, 2022


Imagine having a machine that prints money — we’d all be rolling in riches! Alas, as adults we realize that this dream we had as children is simply not feasible, due to the principle of inflation. When the money in circulation increases, the cost of goods and services increases accordingly. The principle that a burgeoning money supply causes high inflation is one of the basic laws of economics.

The dream-like machine often appears to take the shape of Play2Earn blockchain games. The idea is simple. Owning a crypto-asset allows players entry into the game ecosystem, which rewards players in native tokens which they can then cash out. The logical adult knows this is definitely too good to be true — and most of the time, such P2E games mirror Ponzi schemes. It is therefore not surprising that a common question regarding STEPN is usually regarding the sustainability of the game.

A previous article examining ponzinomics in detail concluded that in order for a P2E game to be sustainable, games both need to provide non–economic value for players, and have strong tokenomics. In this article, we will deep-dive into STEPN tokenomics and have a good feel of the longevity of the game.


Tokenomics refers to the economics of a cryptocurrency token — what determines the value of a token? Simply put, it is all about the supply and demand of the token. Similar to any free-market asset, increased overall demand will naturally drive a higher price. It is thus one of the first things that any savvy investor looks at before deciding to put their money into a project or company.

The aim of any good token-based project is twofold. First, to ensure that the token is high in value, and gives investors good returns. Secondly, to ensure that these good returns are stable and sustainable over years. Now, while it seems like these two goals are at odds with each other, strong tokenomic management and dynamic response by the team make it possible. We will talk more about this later.

Let’s talk about supply. If a token is generated regularly over time with nothing to curtail its increasing supply, it would devalue over time. For example, if a token is worth $1 at a 100 total supply, it would be worth $0.10 if the supply increases to 1000 — assuming the demand stays the same. In order to reduce the supply, there need to be use cases where the token will be burnt. For example, paying a fee to level up a shoe burns the tokens, therefore reducing the total supply. These are also referred to as token sinks or burning mechanisms.

With regard to demand, people selling their tokens will cause the price to drop. Demand for a token can either be driven by strong use cases, or people buying because they think that the token price will increase in the future. The latter is often tied to high confidence in the project and the team.

It is clear that well-designed burn mechanisms are vital to the stability of a token and the longevity of a P2E game. This determines both the selling and buying pressure of tokens.

Another important factor to consider would be the allocation of the tokens. A common feature of poor tokenomics would be large quantities allocated to private investors, with little to no minimum lock-up time before they can sell it (AKA vesting period). This would allow them to sell it in bulk and cause the prices to dump.

Now that we have briefly covered what good tokenomics should look like, let us examine STEPN’s utility and governance token.

About GST and GMT and their use cases

Green Satoshi Token (GST) is the utility token. The supply of GST is unlimited — users earn GST through their daily movement. To ensure the stability of GST, STEPN is designed with plenty of burn mechanisms. These involve upgrading your in-game assets like shoes and gems, unlocking gem sockets, and repairs. GST is also used to mint new shoes.

Green Metaverse Token (GMT) is the governance token of STEPN. GMT supply is fixed at a total of 6 billion, of which 30% will be distributed through M2E and governance participation. As opposed to GST, GMT is designed to be deflationary (much like Bitcoin) — the total release of GMT will halve every three years.

GMT earning in the game via movement has not been enabled yet. Below is an excerpt from the whitepaper, on the various stages of GMT earning.

At Stage 4, users with a Level 30 sneaker and at least three energy will be able to start earning GMT through movement. The amount of GMT earned is based on the Comfort stat and is randomized.

The use case for GMT is plenty. These include burning GST to upgrade your NFTs:

  1. To reach level 5/10/20/29/30
  2. Upgrading Level 4+ Gems
  3. To mint sneakers of all qualities
  4. Re-distributing attribute points

Other than upgrading your NFTs, GMT can be burned to enhance the game mechanics tied to your account. These include burning GMT to:

  1. Permanently increase GST Daily Earning Cap
  2. Permanently improve the success rate of ALL Gem upgrade
  3. Permanently improve the chance to receive a higher quality Sneaker from opening Shoebox
  4. Permanently improve the chance to receive TWO Sneaker from Shoe-Minting

Another extremely interesting use case of GMT would be the Schadenfreude Pools, where users can pay GMT to subscribe to such pools, and enjoy a return of the GST taken from player’s unfortunate moments like opening lower quality sneakers from higher quality shoeboxes or unsuccessfully upgrading gems.

Cost and effect of the value of GMT and GST

A basic overview would be that token value would go up if there is stronger buying pressure than selling pressure. Let us look at why people will buy and sell these tokens.


  • New players joining the game. After purchasing their first sneaker, they might choose to immediately purchase GST/GMT to upgrade their shoes.
  • Players choose to increase their portfolio of shoes. Apart from buying the shoes off the market, this usually involves a good amount of minting, which requires tokens.
  • Believing that token prices will rise in the future, and selling when it does
  • These buyers could very well be non-players, hoping to make gains off trading tokens
  • These buyers could be short-term swing traders or genuine believers of the project
  • To an extent, hype does play a part. Seeing STEPN gaining in popularity would lead to an assumption that token prices would go up.


  • Users cashing out. Usually happens when users have upgraded their STEPN assets to a satisfactory level.
  • Profit-taking. Given that everyone is here to make money, all holders of the token will have different points where they would wish to take profits. This can be from speculators, users, and even private investors

Recently, GST has seen an explosive increase in price — from hovering at $4 to $5.5 for most of April to suddenly reaching an all-time high of $9.03. The cause of this was likely Coinbase listing. This drew attention to GST as suddenly retail traders had easy access to the token, drawing in large numbers of speculators towards its price.

The sudden increase in price has drawn mixed reactions from STEPN users. Those with substantial holdings of GST happily sell for a good profit, whereas users planning to or are currently in the midst of upgrading see no cause for celebration.

A detrimental effect of the GST spike is that it slows down the onboarding of newer users. As the GST price increases, so does the price of sneakers. This means that newer users are often priced out from getting started in the STEPN ecosystem. Further, there is no guarantee that GST price will stay at these levels, given that it is likely that GST is bought by traders who will sell eventually instead of burning them to upgrade their NFTs. This results in a slower return on investment for users who buy at current prices.

It is thus clear that for STEPN to do well, it has to be both profitable for established players and price-friendly for newer players. This is especially true at this stage, where STEPN is still in its public beta. As such, a balance has to be sought in terms of the value of GST. The team is well-aware of this and is taking measures to achieve this balance.

What is STEPN doing to maintain a balance?

In the previous article on ponzinomics, we concluded that in order to maintain sustainability, game developers must be agile in their management of the game.

One example was the double-earning events held during the early days of the game. In order to keep GST prices in check, while also simultaneously rewarding early adopters, the team decided to introduce week-long double GST earning incentives. Done twice, the event has been well received by the community, and also achieved the desired outcome of keeping the price of GST stable.

Another more recent example of the team’s dynamic management is their response to the unnatural spike in GST prices when it hit a high of $9 from only being $4-$5 a week prior. Wild swings in prices at this stage would not be healthy for the longevity of the game, as it would affect future players’ expectations of what they should be earning. The team hopped in to promptly introduce certain GST cooling measures, designed to temporarily stabilise the prices.

The measure was simple. Prior to this, minting sneakers only cost GST. They switched up the minting costs to include GMT tokens as well while reducing the amount of GST required.

The effect of this as per time of writing is the burning of over 68 million GMT, over 10% of the circulating supply. It can be verified here.

Given the fixed supply of GMT, this logically is a good move for its future value.

Currently, the value of GST sits at $4 on the Solana chain and $19 on the BNBChain. While it is highly likely that the effects of the larger stock and crypto market dips are at play, it is also clear that the minting measures are effective. This is evidenced by the dip in the price of GST before the broader market crash.

While it was only a temporary measure, it is a good example of how the team may introduce changes in response to volatility. After all, the goal is sustainability for years to come.

Dynamic Minting

As we have established before, the prevention of token volatility remains one of the highest priorities for the team. At the same time, frequent changes are not welcome by both our users and the team. We understand that certainty is important, from both a gameplay and investment perspective.

While the temporary GMT-inclusive minting measures were in effect, the team was working on a more permanent management solution — dynamic minting. In essence, the minting cost takes into account the USD value of GST and adjusts the GST needed in order to mint a shoe. The cheaper the GST, the more GST is needed and vice-versa.

We believe that this is a solution that kills two birds with one stone. It prevents the price of GST from either sky-rocketing or crashing hard while allowing for our players to develop their strategies with surety.

GMT management is also accounted for. Should its price overtake GMT, additional rules will be implemented in order to regulate GMT cost. This will differ from chain to chain, following its native GMT price.

In the event that GST value drops even with dynamic minting at play, there is a multitude of ingenious ways to counter such an event. The concept of sneaker burning is interesting and opens up avenues to increase the use cases of GST. This could possibly involve burning sneakers to add attributes, upgrade them to a higher quality one, or transfer genesis serial numbers to higher quality sneakers. Sneaker burning is also a great way to manage the over-supply of sneakers. Of course, none of these ideas is set in stone yet, but it does show the vast possibilities that exist to keep the general demand of the token in the game sustained. More details are in the whitepaper here.

The STEPN team will respond accordingly to the climate of the ecosystem in the future.


Ultimately, the ideal case for GST and GMT would be for it to have limited volatility — ensuring profitability for both newer and older users. But we know we do not live in a perfect world. Especially in crypto, many external factors can cause huge spikes and dips in STEPN’s tokens.

STEPN intends to be the best health and fitness app with the best incentives for its users to stay healthy and socialize. We are blazing a trail in this new unexplored world — an assurance that our users can hold on to is that the team is always going to work for the betterment of the users and create the first-of-its-kind platform that promises a Better You and a Better Planet!



STEPN Official

STEPN is a Web3 lifestyle app with Social and Game elements.