What Are Meritum Tokens?
2 days ago I announced Lumen. The part that got the most questions was Meritum, so this post is only about that. What it is, why it exists, how the math actually works.
The idea, before the math
Meritum is one token per creator, and it does two jobs at once. It is a claim on their work, and it is a position in their trajectory. You buy it because you want something from them. You also buy it because you think more people will want something from them later. Those two reasons are usually in tension. Here they are the same trade.
Demand for the work is what moves the price
A creator lists what they sell. An audit, an hour of their time, a review, a track, a logo, a chess lesson. They price it in dollars. A buyer cannot pay in dollars. They have to pay in that creator's Meritum.
So the buyer goes to the curve and buys Meritum with HBD. That purchase moves the price up. The tokens go into escrow. The creator delivers, the tokens are released to the creator, and the buyer leaves a rating that is permanent and public.
Note what did not happen there. The tokens were not burned. They went to the creator. Supply did not change. The price moved because somebody bought, not because somebody spent.
The result is a loop that is honest: if a creator is in demand, people buy their token to reach them, and the price rises. The price is a running measurement of whether a person's time is wanted.
Now, considering a token exists, the reality of how a buyer values their purchase can do absolutely nothing with any work attached. No work even has to be attached.
That is the freedom of an open market. Maybe you are only interested in the reputation of the person, maybe you just want to speculate.
The UI for "offerings" is there to entice you to provide utility. It is not there to force you inside a box.
Yes, you can just speculate
Obviously, speculation is a big part of Meritum. No point to hide from that.
You can buy a creator's Meritum because you think they are early. You can sell it later. You never need a counterparty, because the curve is always the counterparty. There is no order book to be thin, no market maker to disappear, no listing to wait for. Buy and sell are functions on a smart contract and they are open from the first block.
Speculation is not the parasite here. It is the bootstrapping. Somebody has to be the first to believe a creator is worth more than one HBD, and the person who does that takes a real risk and deserves a real upside.
How the curve works
Every Meritum is bought from and sold back to a bonding curve. No liquidity providers, no pools, no pairs.
The first token always costs about 1 HBD. Every creator starts at the same place. No presale, no founder allocation, no private round. The creator's own first buy pays the exact same curve as anybody else, at the same moment, with the same fee.
The price is a formula, not an opinion. Supply goes up, price goes up, and the shape is fixed in the contract.
The money is really there. Every HBD paid in sits in the market's reserve, and the reserve is exactly the area under the curve up to the current supply. That is not a claim, it is an invariant the contract checks on every trade. When you sell, you are paid out of that reserve at the curve price. There is no scenario where the market cannot pay a seller, because the money it needs is the money it already took.
The growth table
This is the same formula, run out. "HBD locked" is the real money sitting in that one creator's reserve at that supply.
| Supply | Price per token | HBD locked in the market | Market cap | Price vs first buyer |
|---|---|---|---|---|
| 1 | 1.008 | 1.01 | 1.01 | 1.0x |
| 10 | 1.079 | 10.43 | 10.79 | 1.1x |
| 50 | 1.400 | 60.15 | 70.02 | 1.4x |
| 100 | 1.814 | 140.66 | 181.38 | 1.8x |
| 250 | 3.133 | 510.83 | 783.20 | 3.1x |
| 500 | 5.594 | 1,596.05 | 2,796.88 | 5.6x |
| 1,000 | 11.500 | 5,817.75 | 11,500.00 | 11.4x |
| 2,500 | 37.094 | 40,799.30 | 92,734.38 | 36.8x |
| 5,000 | 106.000 | 212,865.00 | 530,000.00 | 105.2x |
| 10,000 | 342.250 | 1,278,920.63 | 3,422,500.00 | 339.6x |
This curve is deliberately gentle at the start. A creator's first hundred supporters are not paying a tax for being second.
Those returns are real and so is the other direction. If a creator never gets past 10 supply, you are holding tokens worth about what you paid, minus fees. Nothing here promises you anything.
Nothing is set up to exploit you by design. Other similar systems priced the 101st buyer at 10 000x what the 2nd paid, which meant the only way to profit was to find someone later than you. Meritum prices that same buyer at 1.8x, because the curve is meant to offer a fair playing ground for most, not another casino with no point and no reason behind it.
The fees, all of them, in one place
I would rather you read these from me than find them yourself.
| Fee | Size | Who gets it | When |
|---|---|---|---|
| Trade fee | 5% | half the creator, half the platform | every buy and every sell |
| Exit tax | 15% falling to 0 over 42 days | the platform | only if you sell early |
| Service commission | 12% | the platform | only when a job is delivered |
The exit tax is the one worth explaining. It starts at 15% and decays to zero over six weeks of holding. It exists to make a creator's market useless to flip and useful to hold. If you buy someone's token believing in them, six weeks costs you nothing. If you buy it to dump on the next person, you pay for that.
This is a new job for HBD
Here is the part that I think matters most for Hive, and it is the part nobody asked me about.
Every single Meritum is bought with HBD.
And that HBD does not pass through. It stays. It sits in the market's reserve for as long as the supply exists, because the reserve is what backs the token. A creator with 1,000 supply is a creator with 5,817 HBD locked in a contract that cannot spend it on anything except paying sellers.
It is a demand sink that grows with the number of creators and the size of their audiences, and every unit of it is locked by somebody who wanted something, not by somebody chasing a yield number.
1000 Meritum creators at 1000 supply each is close to 6 000 000 HBD off the market. I am not going to pretend that happens next week. I am saying the mechanism points that direction.
Why Meritum is different
Everyone is going to make the comparison to other iterations of this, so I will make it first.
The other protocols did one genuinely clever thing: they put a bonding curve on a person and let people buy in. At their peak they were doing more daily fees than most L1s. Then it went to nearly zero.
The reason those died is not that people got bored. It is that the key never did anything. You bought a key, you got a private chat room, and that was the entire product. The only reason to buy was that someone else would buy higher. When that stopped being true, there was nothing underneath.
I am not claiming we cannot fail. I am claiming that if a Meritum market goes quiet, the thing left is a creator who still sells something and a reserve that still pays sellers. That is a floor. They did not have one.
The offerings UI is not just for freelancers
The screen where a creator lists what they sell is a name, a price, and a description. That is intentionally generic, and you should abuse it. :D
An artist sells commissions. A developer sells a code review. A musician sells a verse. A teacher sells an hour. A community sells a spot in a tournament. A curator sells a read of your post. A podcaster sells a guest slot. It is a price list attached to a person, or a community, settled in their own token, with delivery enforced. What goes on the list is for you to deal with.
The buy, hold and sell functions do not reference offerings anywhere. A Meritum market works perfectly well if nobody ever lists a single thing for sale. The price still moves, the reserve still backs it, the exit is still open. Selling work is one thing you can attach to a token. It is not the token.
It can be membership. Holding is the product. You hold a creator's Meritum because you are one of the people around that creator, and anybody can see exactly how many of you there are and what you were willing to pay to be there. No monthly billing, no subscription to cancel.
It can be backing without being a donation. When you tip someone, your money is gone. When you hold their Meritum, you have taken a position and you can leave at the curve price whenever you like. That turns supporting someone from an act of charity into an act of conviction, and those attract very different people in very different numbers.
It can be access. Hold some amount, get in. A room, a role, a list, an event, a tier. The contract does not implement that and it does not need to: the balance is public and anything can read it.
It can be a community token. Nothing requires a creator to be a person. A community launches a Meritum, and the holders are the members. The price becomes a live measurement of how many people care and how much. Hive communities have wanted a token for years and what they usually get is an infinite supply, a mint button, and nobody to stop it. This gives them a fixed formula, a real reserve.
It can be a fundraiser that gives the money back. Launch a token for a project. People who want it to exist buy in. The HBD sits in the reserve, visibly, and nobody has to trust you with it, because you cannot take it. If the project works, the holders are up. If you disappear, they sell back down the curve and take their money out.
Where it actually is right now
Meritum is live. Creators have launched, tokens have traded, fees have accrued, and the contract has been updated once already since launch.
Like always, I encourage you to try it out. Try something new on Hive.
Show your Meritum at https://lumensocial.net/creators
Nothing in this post is financial advice. A Meritum can go down. If a creator stops delivering, their market is worth what the curve says and nothing more.