AAVA Tokens

In broad terms, the tokens are non-tangible digital assets that represent value or rights and are registered in a decentralized blockchain. Often the tokens are in the form of a smart contract as is the case with AAVA.

The AAVA ecosystem consists of two primary components:

1. The DAO,  a membership driven community that acts as a controlling entity for the business and the decision making, growth, and business development.
2. The Securitized Token, that will be used to raise and channel funds to projects that support sustainable development or climate positive activities that support the global community while providing reasonable returns for the Token Holders.

Tokens on a blockchain are often used for raising funds, management of an activity, or fractional ownership of assets on- and off-chain. This is the case with AAVA Tokens.

In the context of the climate markets, tokenization of operative control (distributed autonomous organization) and opening up access through a fractionalized structure is innovative and genuinely leverages the power of web3 in a more traditional industry.

The tokenization allows new capital to engage with the climate markets under a transparent, secure, fair and beneficial manner.

The key advantages of the AAVA Tokens for investors are:

• Early investors get decision making power
• Tokens allow investors to have liquidity and are not forced for long hold periods.  Paper value is not very liquid, Securitized Tokens solve this by being a tradable asset that can has value and can be sold easier before maturity of the investment.

The Climate Performance Tokens are built to be Securitized Tokens that are compatible for regulatory oversight.

We’ve recently seen the regulators especially in the USA and other developed markets undertake a strong interest in the crypto space. This is a good thing. When you think about it the regulator is there to provide a layer of protection for consumers and investors. Initiatives like AAVA Climate Performance Tokens with a solid business plan based on value creation, long-term sustainability, and transparency welcome this.

Of course it causes more work on setting up a robust structure to comply but in the long term this kind of ambition is what will create a leading and successful venture that benefits all stakeholders. This is what drives us!

Even the markets are calling for regulation: Michael Saylor, one of the world’s largest Bitcoin holders is calling regulators to tackle the wild west of crypto and token based initiatives.  Read the full article here.

As you participate in the AAVA Climate Performance Token ecosystem, you are purchasing AAVA Tokens that represent a fractional ownership of the portfolio of the corresponding Token pool. 

In terms of returns, the Token holders gain a percentage share of revenues based on the number of Tokens you hold (investment level)

The value of the AAVA Token will be based on the revenue generation potential on a dynamic basis.

Dynamic how? 

As capital is deployed to activities, they will lock in projected revenue based on the business model for each activity.  For instance, from market related activity

• In the short term, we will report projected and realized portfolio values.
• For mid-term activities, we will be able to report projections on revenue streams based on the value of contracts that we are locking in, as at this time we will already have validated the business mode of the activity.  
• In the long-term, we are dealing with more uncertainties so any inclusion in the projected earnings would need to be evaluated on a conservative manner to establish the revenue generation potential, but in the implementation phase we will already be able to access offtake interest.

As a summary, the estimated total portfolio value of the projects that are part of the Token define the baseline value for the Token.  Naturally, due to the conservative approach, the Token capitalization will likely to rise due to expected market development and as we get closer to the revenue generation milestones.   The secondary market may also respond to the assumptions in the portfolio valuation.

impacted by:

• Baseline investment
• Revenue or profits generated
• Contracts estimated value over time
• Impacts to revenue closer to generation when more accurate data is available
• Forward sales contracts
• Secondary market value perception and expectations

Initially, the project types will generate a revenue stream through direct project profit and through carbon finance (generation of carbon credits).

In the caser of carbon credits, the credits generated by projects are not intended for use by the members directly but taken to the market and monetized at the highest possible value, the net income will be distributed among the Token holders.  In the future, revenue distribution can be determined by the Members (direct carbon credit distribution, crypto or fiat currency payment to Token holders or partial reinvestment to boost overall Token value).

The number of AAVA Tokens to be issued has not been decided yet.  This will be determined by the project pipeline the AAVA DAO Members wish to pursue and how much capital is needed for deployment.

One of the strengths of the blockchain is the efficiency and transparency that can be gained from its use.  While we started the project by just conceptualizing the AAVA Token, we soon realized that to be fully a web3 based business, we also needed to expand this to the decision making. 

As a result, we’ve launched the AAVA DAO, a Digital Autonomous Organization, where DAO Members propose and vote for decisions regarding the actions to be financed by the AAVA Token capital.  Transparently, fairly, and efficiently. 

More on the DAO at www.aavatoken.com/aava-dao