summary: DAFI Protocol is a protocol that incentivizes participants to stake tokens without using any hyperinflation mechanism. 
content: DAFI Protocol (DAFI) (founded in 2018) is a Blockchain Protocol that incentivizes participants to stake tokens without using any hyperinflation mechanism. It uses network rewards for building a decentralized economy instead of directly issuing tokens for staking & liquidity – Dafi ties synthetics to each network’s adoption. History The Dafi Protocol was first formed during the catastrophic 2018 crash – where it became obvious that the incentive model for decentralized economics is fundamentally flawed. Originally, Dafi was building a simple marketplace around AI tools and data. In 2018, testing different models in Blockchain. The fixation on developing a stable token economy became the sole focus. After years of research into a smarter inflation model, working with leading universities, and the Royal Bank of Scotland – Dafi gradually left stealth mode In October 2019, Dafi’s team was invited to speak at the largest IoT World Congress. Dafi Protocol was added to the National Westminster bank’s incubation in 2020 Dafi introduces the first alternative since Satoshi, to use network rewards for building a decentralized economy. Instead of directly issuing tokens for staking & liquidity – Dafi ties synthetics to each network’s adoption. This means that token’s released & network demand is proportional. By linking these two factors, it attracts longer-term users to be incentivized longer, supporting adoption. DAFI, creates the first transition from simple token rewards, to demand-tied rewards – incentivizing users better, for liquidity/staking. DAFI is staked, to create a second, synthetic token This dDAFI is tied to the adoption of the network As demand rises, the synthetic expands in quantity. As demand declines, it reduces to prevent an excess emission of rewards Dafi can be implemented by all networks to reward their users, without the risk of over-issuing too many native tokens. It will create stable adoption without hyperinflation thereby creating chains and finance that will last. Services DAFI creates synthetics to reward networks, for long-term users. It solves the biggest issue within decentralized economies - by rewarding users later, instead of earlier. The Problems Every decentralized economy since Bitcoin is forced to distribute large amounts of tokens to their network. This incentive model creates an excess supply. Nobody likes this, it simply devalues the economy, without supporting early users. The Problems with DeFi Hyperinflation: Incentivizing users to participate in a decentralized economy is important. This becomes difficult when demand is already low – simply issuing tokens during this period creates harmful supply-shocks. Short-term users: Distributing token rewards attracts new users, but doesn’t favour those that are longer term. There is no economic incentive to those users who accumulate rewards to support until adoption rises. Market declines: In 2018, the same inflation model crush many token economies. Even Bitcoin miners were forced to shut down operations due to the lack of incentives. Dafi was inspired by this – to create a model where the network emission of tokens would be tied to its demand, which could have enhanced scarcity to protect an excess supply in such conditions. DAFI Solutions Instead of distributing a token directly, the Dafi protocol enables networks to create a synthetic in a reduced quantity. As demand rises, the synthetics (dToken) increase in quantity. Dafi can incentivize early users and maintain a network in bearish markets, without issuing large quantities of tokens through the following: A new model: DAFI is staked for rewards pegged to the demand of the protocol Scarcity: Dafi is a smarter way of creating scarcity, by reducing reward quantity if demand declines Adoption: Dafi’s new inflation model allows every layer-1, layer-2 protocol and cryptocurrency to reward their users based on adoption. Overview The success of any crypto project relies on its adoption. The more users it has, the more chances of the project surviving and, ultimately, its token value rising to an acceptable level. To that end, one of the most common tactics used by decentralized projects all over the world is to have a token issuance method where early adopters are rewarded either by cheaper coins or issuance of a greater number, higher staking rewards, bounties, and other incentives to hold on and drive up the value, causing more people to join in. However, Dafi is one platform that believes that this method is ultimately flawed and comes straight with a solving solution. Dafi creates long-term users by rewarding based on network adoption. All decentralized economies distribute tokens to users. The problem is that distributing tokens when adoption is low, creates an excess supply & devalues the economy. There is no link between the release of network supply and the network’s adoption. This harms longer-term users and only favours short-term participants. Dafi enables every protocol and platform to create a synthetic flavour from their native token. This is then pegged to the demand of their network and distributed to users. Meaning users are still incentivized when adoption is low, but by being rewarded later, not earlier. Individuals can stake the DAFI token for Governance and collateralize the creation ofdDAFI, the first synthetic unit which is tied to network demand. The quantity of the synthetic can increase only as network adoption rises – incentivizing longer-term users. Features Synthetic rewards: The DAFI token is staked for synthetics - which increase in quantity only as demand rises Flavours: Every blockchain and cryptocurrency can create a synthetic to incentivize their users better Scarcity: DAFI rewards users even when demand is low, by actually enhancing dcarcity- dToken rewards these users later by increasing in quantity when network demand rises. Roadmap 2018: Dafi testing theories in blockchain 2019: Presenting at institutions and events & NatWest bank incubation 2020: Dafi branding changes Strategic partnerships confirmed privately MVP development User-creation platform for synthetics 2021: DAFI token sale DAFI staking to create network synthetics New protocol flavours of dToken Dafi NFT minting using synthetics 2022: Further DeFi features built on DAFI (lending, DEX's, NFT's of value) Creating a financial universe around DAFI. $DAFI Token The native digital cryptographically-secured utility token of the Dafi platform (DAFI) is a transferable representation of attributed functions specified in the protocol/code of the Dafi platform, which is designed to play a major role in the functioning of the ecosystem on the Dafi platform and intended to be used solely as the primary utility token on the platform. $DAFI has a total supply of 2,250,000,000 which are traded on its listed exchanges. DAFI is a non-refundable functional utility token that will be used as the medium of exchange between participants on the Dafi platform. The goal of introducing DAFI is to provide a convenient and secure mode of payment and settlement between participants who interact within the ecosystem on the Dafi platform, and it is not, and not intended to be, a medium of exchange accepted by the public (or a section of the public) as payment for goods or services or for the discharge of debt; nor is it designed or intended to be used by any person as payment for any goods or services whatsoever that is not exclusively provided by the issuer. DAFI Token Stake The DAFI token is staked for synthetic dDAFI, each pegged to the demand of the protocol. Decentralized economics creating synthetics on Dafi, transact a DAFI fee which is returned to the staking reserve. Dafi is unique in its method in that it allows any platform to deposit their native tokens onto the Dafi network and receive synthetic tokens in return. These synthetics are based on the Dafi protocol and then can be used by the original network, allowing them to link their network adoption with their token issuance. The synthetic tokens can be used in several different DeFi and other platforms, with each platform capable of creating different flavors of tokens aimed toward their specific requirements, such as staking, liquidity provisions, bounty programs, etc. Incubated by Royal Bank of Scotland DAFI initially broke grounds being incubated by a leading European Bank, the National Westminster Bank USA (otherwise known as the Royal Bank of Scotland). Natwest Bank is one of the largest UK-based banks, and a part of the prestigious RBS group. The National Westminster Bank decided to support DAFI through consulting and accelerating the project under their FinTech arm. Featured in Natwest Business DAFI protocol was also spotlighted in the December edition of NatWest’s monthly newsletter. This was instrumental in introducing DAFI to a whole new audience unaware of blockchain and decentralized finance. Close ties with Academia DAFI believes in embracing education surrounding Blockchain and the new models transforming the field. Dafi’s team worked with several Universities, Researchers and of course Students to foster conversations around the digital environment. In late 2020, Dafi CEO Zain Rana presented the project at the University of Manchester and the University of Leeds. Breaking down the economics in how decentralized economies are created, including Bitcoin, and how they can be improved. On February 1, the prestigious University of York hosted DAFI’s team for a night of stimulating discussions and engaging conversations around blockchain economies. Exchanges 