Stepn, a popular Web3 “move-to-earn” fitness game, has expanded a program to buy back and burn its GMT tokens.
The game will also expand from Solana and BNB Chain to Ethereum.
Stepn, a Web3 fitness game billed as a “move-to-earn” experience, is making some major moves of its own. The startup announced today it will use a portion of its Q2 profits to buy back and burn tokens, plus the firm recently revealed an expansion to the Ethereum blockchain.
According to the company, it earned $122.5 million in second-quarter profits from platform fees. Now it plans to use 5% of that ($6.125 million) to buy Stepn’s GMT governance tokens from the secondary market and then burn them.
At the current price of $0.87 per token, that would amount to just over 7 million GMT tokens permanently removed from a max supply of 6 billion (600 million of which have been circulated). Crypto firms—including exchanges like Binance and PancakeSwap—sometimes initiate such buybacks to reduce supply and drive up token values.
“The buyback and burn accrue value back to GMT—our unifying thread across all the initiatives that we undertake at Stepn,” Chief Marketing Officer Shiti Manghani told Decrypt today, “be that the sustainability of our game economy, the launch of our [decentralized exchange], DOOAR, or new launches on the horizon.”
This isn’t the first time that Stepn has used profits to buy back and burn tokens. In April, the firm announced that it would spend approximately $26 million to do just that, and its official website shows that it’s burned more than 216 million GMT tokens to date. Stepn has plans for additional quarterly token buybacks and burns.
Stepn is a mobile app that rewards users with cryptocurrency for running and walking in the real world. It’s an experience that Manghani recently described on Decrypt’s gm podcast as being like “Strava meets Pokémon Go.”
Users must buy NFT digital sneakers using cryptocurrency, but then they can earn token rewards in return by getting out and moving. Manghani said in June that the game has amassed more than 3 million active users since launching less than six months ago.
The app saw significant demand this spring as the GMT and GST reward token prices surged, although prices have fallen amid a wider crypto market crash. Currently, Stepn is primarily based on the Solana blockchain, but the company has also released digital sneakers on BNB Chain, formerly known as Binance Smart Chain.
Last week, Stepn announced it will also expand into the Ethereum ecosystem in the near future, and will allow holders of Bored Ape Yacht Club NFTs—valuable collectibles that sell for more than $100,000 worth of crypto each—to mint a free pair of NFT sneakers on Ethereum.
An NFT is a blockchain token that represents ownership of an item, including digital goods. Ethereum currently hosts the largest NFT ecosystem, but the blockchain network has some notable downsides compared with Solana and BNB Chain—notably slower and more expensive transactions, plus a larger environmental impact to operate the network.
Stepn acknowledged some of those concerns in a post last week, but suggested that there’s a significant opportunity to onboard many more users by adopting Ethereum. The firm highlighted the blockchain platform’s history of “innovation and decentralization” over the years, as well as its large number of decentralized apps (dapps).
“It is in line with our mission to onboard the next 100 million users,” Manghani told Decrypt. “This will be accomplished by welcoming new communities. Amongst them, the Ethereum community is at the forefront.”
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