5th Dimension, Economy Paper
Version 1.0 – 30/01/2025
Overview
5th Dimension is a triple-A, multiplayer computer game built on a native token economy integrated with a fiat revenue business model.
The game’s global currency and native utility token, $Dimens, combines the features of a regular computer game or in-game currency with a cryptocurrency and game-fi solution. It is used both as a unit of currency in-game by players to access content and gameplay UX, and simultaneously by Web3 traders to participate in the game’s token economy.
By deeply connecting the game’s fiat revenue business model with its token economy, an evergreen flywheel of value creation is produced via creating a circular economy with deflationary and non-linear emissions features.
Economy Overview
The 5th Dimension game economy leverages 2 units of currency;
Prana – A non-productive token used to access in-game content for free
Dimens – A productive crypto-token rendered on BNB chain used to monetize gameplay and content
The purpose of this document is to provide an analysis of the game’s Web3 economic system and its features, thus it focuses on the use and business cases for the Dimens token.
Dimens token supply is fixed and limited to 10B.
Token Ledgers and Pools
2 token ledgers are maintained for the Dimens token, one that records the balance and distribution of tokens within the game economy using an internal ledger or hot wallet, and one that does the same for the global distribution of tokens on-chain. Only the number of tokens entering and exiting the in-game ledger is visible on-chain, individual transactions are not.
The in-game ledger or hot wallet is used to manage the distribution of play to earn prizes, to record in-game transactions made using tokens and to record the token balances of individual players . When tokens enter the game’s economy (hot wallet), they are defined as part of the game’s internal circulating supply. Players then earn tokens as Esports prizes (or P2E rewards) in-game, and spend these tokens on character upgrades to continue advancing their ability to compete in Esports and earn ever higher rewards by progressing through a series of 10 levels or leagues, each of which offers higher amounts of prizes. The balance of tokens earned, held and spent by each player is recorded in the game economy ledger and this data is not publicly accessible.
The token contract (ledger) on-chain operates like any other and is rendered using standard erc20 smart contract architecture on BNB chain.
Token Functions
The Dimens token is a fixed supply fee settlement token used as the exclusive payment method within the 5th Dimension game economy and Web3 economy. The token trades on the Pancake Swap Dex and the dapps used to access token economies native Web3 functions including its game item marketplace and token staking pools are available via the RealityJam platform. The game and the platform interoperate to combine Web2 (game) and Web3 (platform) functionality in separate, interoperating software modules for security and market access purposes. A list of token functions follows;
Esports Prizes / Play To Earn – Players earn tokens for competing in and achieving certain rankings in daily Esports matches activated within the 5th Dimension gameworld. Tokens distributed as prizes are contained within the game’s hot wallet / prize pool and the supply of tokens available for prize distribution is dynamically replenished (see below).
Subscription Payments – To gain access to Esports prizes, players pay a monthly fiat subscription fee of $9.99 (basic membership) or $19.99 (premium membership) to empower them to access Esports events and prizes. Revenue generated by subscription fees is automatically used to buy Dimens tokens on Dex and these are then contributed to the prize pool.
In-Game Item Purchases – Players spend Dimens tokens to purchase upgrades which allow them to advance the development of their player characters to empower them to win Esports events and prizes ever more effectively and ‘stay in the game’.
Game Item Sales – Players spend or earn Dimens tokens by selling and selling the following game items:
- Player characters (AI agents)
- Game Levels (aka Venue) within which public Esports events happen
- Weapons, weapons skins and weapons mod.s
Staking and Staking Rewards – Stake tokens in the game’s native staking pools and earn APR rewards
Provide Liquidity – Provide paired liquidity to the game’s project owned liquidity pools on Pancake Swap.
Payments
Token payment services are contained entirely within the RealityJam platform or in the case of liquidity pools, the Pancake Swap DEX. Players may settle payments for character upgrades within the game user interface, however if they want to settle a payment to purchase levels, AI player characters, weapons or weapons skins they must log into the RealityJam platform and connect their wallet to gain access to the various services and dapps that facilitate payments.
Token Purchases / Fiat On Ramp
Users purchase tokens to be used in-game with debit or credit card using a native fiat on-ramp (integrated with Stripe) available via the RealityJam platform and these tokens are credited to the player’s wallet and can then be used to make purchases in the game’s marketplace to buy game items (as above).
Item Sales
Users are able to sell game items and receive payment in tokens for the items they create using the game’s Web3 marketplace which operates via the RealityJam platform. Items are created using the features of the game itself or the game’s stand-alone companion app, the 5th Dimension World Builder. An array of game items can be created and made available for sale whereby sales are settled exclusively in the Dimens token currency.
In-game Upgrades
Players spend tokens on upgrades of weapons and game characters and this is a key demand driver within the token and game economy, however these purchases are performed solely within the game UI and are not recorded on-chain nor available via the game’s marketplace.
Fiat Sales and Purchases
Players who do not wish to transact using tokens or use cryptocurrency may buy and sell items via the game’s Steam Workshop store, wherein the only method of payment is debit or credit card. This store operates in parallel with the game’s native game item marketplace and is intended as a channel solely for user generated content. Official content made available by the game’s publisher will be sold exclusively via the RealityJam platform and may only be bought using tokens..
The diagram below illustrates the transactional flow that drives the 5th Dimension token economy:
Esports & Play To Earn
Esports Events
Esports events take place over a 1-hour period, twice per day, 6 days per week. The game is available to players outside these times however they are only able to earn Prana tokens during these times, not Dimens tokens.
Esports Subscriptions
Players pay a subscription fee of $9.99 or $19.99 per month to access the game’s play to earn prize pools.
These funds are immediately used to purchase tokens on Pancake Swap using an automated fiat on ramp integrated with the Pancake Swap Dex and are instantly deposited to the game’s prize pool.
Subscription price is fixed, subs cannot be paid using tokens that are held in a wallet they must subscribe with a credit / debit card via the RealityJam platform / Stripe, similarly players don’t receive any Dimens in exchange for subs payments, only the opportunity to win them.
Every player will win an amount of tokens for participation, however on average only 50% of players earn more tokens than they purchase, meaning that 50% of players actually receive less tokens each month than their subscription payment produces.
Cashing Out
In the event that players remove their tokens from the game economy to trade or sell them using the game’s public trading venue (Pancake Swap) they must log into their RealityJam platform account, connect their wallet and perform a claim function that validates the token balance of in-game ledger (above) and then deducts the required number of tokens from the game’s prize pool and credits these to the player’s wallet.
Any transactions over $2000 in total value require manual approval from a RealityJam team member to ensure players are unable to hack the game and fraudulently withdraw large amounts of tokens.
Cashing out tokens and swapping them for stablecoins via Pancake Swap is the only way that players can transfer Esports prizes into cash, with the exception of the monthly prize pools for BattleMax events which are paid in cash or stablecoins (see below)
Dynamic Conversion Rates
Given that 5th Dimension is designed to serve the interest of both Web2 and Web3 users, prizes are denominated in $USD. This presents an issue due to the exchange rate fluctuation of $Dimens versus $USD.
To combat this, the exchange rate is dynamically adjusted. Once per week the amount of Dimens rewards provided for prizes is reset or calibrated based on the market exchange rate to maintain a scenario where approximately 50% of players make a profit on their monthly sub payments of between 10% and 50%, and qualifying venues receive, on average $10 worth of Dimens per venue per month (more on the policy for prize distribution below).
If market fluctuation reduces Premium players cash out amount by more than 5%, additional tokens are provided from the prize pool to cover any losses, if player’s cash-out amount increases by more than 5% due to market fluctuation the total amount of tokens provided is reduced to limit upside to (at most) 10% in order to avoid unsustainable sell pressure arising from players cashing our prizes
This policy minimizes a scenario where players make huge profits by selling tokens earned in-game when the market price rises.
TVL Maximalism
Due to the fact that a proportion of players who participate in Esports will not be Web3 users, the tokens that accrue in the prize pool from their monthly subscription payments are permanently locked up in the pool, creating a novel solution for amassing ever greater TVL.
BattleMax Tournaments
On the last Friday of each calendar month a game wide leaderboard of player scores is produced and the top 25% of players by ranking are eligible to compete in a 2 day tournament that happens over the following 48 hours, known as ‘BattleMax’ events.
A minimum of $25,000 in prizes are distributed amongst the top 25% of players by rank. These prizes are deducted from the Rewards allocation of the Dimens token treasury, not the in-game rewards pool and are distributed using a 7 day linear vesting schedule to avoid players dumping tokens received as prizes. Subject to token price performance the amount of prizes distributed during BattleMax events will be incrementally increased.
Non-Linear Emissions
Play to earn prizes are emitted and calculated based on a non-linear distribution algorithm that awards prizes based on a percentage of the total available in the prize pool, meaning that emissions decrease over time, creating a perpetual prize pool that can never be fully consumed (see below)
Venues
Venues are game levels created by players within the 5th Dimension gameworld using the game’s companion app, the 5th Dimension World Builder.
Venues may be used to host gameplay daily during Esports events, the better the design and the more fun they are to play in, the more likely it is that players will choose a specific venue to compete in.
Venue builders must pay a $49.99 fee to publish their venue within the gameworld, and thereafter become eligible to share in a separate prize pool made available specifically for Venue builders.
Venues generate rewards on a monthly basis. During the previous calendar month the amount of game play-time produced in each venue is calculated and a leaderboard produced. To qualify for rewards, venues must reach a minimum threshold of play time. The top 75% of qualifying venues share in a distribution of Dimens tokens emitted from the Treasury rewards allocation using a non-linear emissions algorithm (below) and Venues will receive, on average, approximately $10 in rewards per month, with the amount received scaled based on the total amount of play time recorded in each venue.
Token Economy Model
The Dimens token economy is self-sustaining and circular by design and has been architected to support long term price performance, TVL growth, deep liquidity and price stability.
Economic Drivers
As described above, users pay a monthly subscription fee to access Esports events and prize pools. Any and all funds paid for subscriptions are automatically converted to Dimens tokens by swapping them on the project’s public trading venue, Pancake Swap using an automated fiat on ramp integrated with the Dex whereby subscription payments automatically produce buy orders on the Dex.
These tokens are then divided as follows;
A) 90% of tokens are deposited to the Rewards Pool.
B) 10% of tokens are removed from circulation and stored in the Protocol Vault – A secondary project managed wallet that is used to provide liquidity on Pancake Swap and other DEXs. Funds received in the pool are provided for LP on behalf of the community and LP rewards are distributed to community members (including players) pro rata based on:
A) the amount of staked LP their wallet provides and,
b) their Dimens token holdings.
Liquidity is provided exclusively using Uniswap V3 Pools based on a certain price range to limit the potential for downside loss particularly from short selling and the price range for LP is defined and updated by a protocol vote conducted once per quarter using Snapshot.
Perpetual Rewards Pool
Rewards for P2E staking and LP are emitted from the game’s Rewards Pool, which is funded by the tokens from the Treasury’s rewards allocation (50% of the total token supply). 10% of the token supply is contributed to the pool per year for 5 years until fully emitted. The operation of the pool is based on a non-linear distribution algorithm as defined below.
This solution addresses a recurring problem in the blockchain sector in that companies prefer to provide large incentives up front (in order to boost their token price) and subsequently run out of tokens as a result. A more sophisticated solution, inspired by Bitcoin, is a “perpetual pool” in which the rewards decrease over time to guarantee that the pool will not run out of tokens in the near future.
The pool runs on an epoch-by-epoch basis, with set per-block payouts for each epoch (for simplicity’s sake, we will refer to the rewards on a daily basis, from there the per-block reward can be obtained simply by dividing the daily reward by the number of blocks within a day). In turn, the epoch reward is always proportional to the quantity of tokens remaining in the rewards pool. Let’s show this using a practical example:
- The pool launches with 500,000,000 tokens
- The Epoch daily reward is set at 0.020% of the pool’s tokens. This means that each day, for the first epoch, the pool will distribute 100,000 tokens.
- The epoch duration is 21 days, so on day 21, 2,100,000 tokens have been distributed.
4 Epoch two starts. The tokens in the pool are now 497,900,000. The Epoch reward is still 0.020%. This works out to 99,580 tokens per day for the next 21 days.
In summary the parameters affecting the token reward distribution schedule are:
- 0.020% of the outstanding tokens in the pool will be used as a basis for the daily epoch rewards
- Epoch duration will be 21 days.
The 0.020% number is picked by targeting an annual inflation rate (based on the total token supply) of around 3.5% in the first year and gradually reducing it from there on. This gives the pool a half-life (the time it takes for 50% of the remaining tokens in the pool to be depleted) of 3,465 days, or 165 epochs.
The daily award is further divided among users as shown in the below table who execute the following actions:
- Provide Dimens/USDC liquidity on Pancake Swap and stake the generated LP tokens
- Stake Dimens Tokens using the project’s native staking pools available via the RealityJam platform
Play-to-Earn and rewarded in-game actions
Rewards are allocated between the 3 classes above as shown below;
Additionally, in order to offset a large amount of tokens entering the circulating supply at once, any rewards received are distributed over a 7 day period. Users must connect their wallet to the RealityJam platform and perform a claim function to receive rewards (vested over 7 days) except in the case of LP rewards on Pancake Swap which are paid via the rules of Uniswap V3 protocol.
Replenishing The Rewards Pool
As described above the rewards pool is designed to be non depletable however over even this design will result in significant reduction over time and a drop in available rewards.
In order to counteract this, a minimum of 25% of all proceeds generated by the game’s item marketplace will be used to replenish the reward pool. The marketplace generates proceeds by charging a 10% commission on all sales and transactions.
This makes the project’s yields an intriguing combination of conventional yield-farming and the current move toward “real yields”. By combining both techniques, we have the best of both worlds – rewards that are first funded by bootstrapping, but ultimately depend on genuine protocol income.
The replenishment of the pool will only be performed if the pool’s current token availability is below 75.0% of the original token allocation. The token allocation is, as mentioned above, based on a pro rata emission of the Rewards allocation / tranche of the project’s token treasury (please refer to the below tokenomics table for more information). If the tokens in the pool grow to exceed this threshold, the remaining tokens (overflow) will be used for liquidity provision and deposited to the Protocol Vault, as described in the respective section. This means that in the early stages of the project, there will be deflationary pressure on the token.
The above setup creates an interesting self-balancing mechanism where eventually the project will reach an equilibrium point at which the daily deposits to the reward pool will roughly be equal to the daily rewards distributed (since the former is a flat value while the latter is a percentage value of the pool). This equilibrium point is self-adjusting since an increase in the deposits would lead to increased rewards and vice versa.
Marco-Economy Model Diagram
The design of the economy as set out herein creates a circular economy that is self sustaining and deflationary as described in the below diagram
Tokenomics
(20.01.2025)
| Stage | Allocation | Tokens (M) | Price | Fundraise | |
| Seed Round | 1.00% | 100 | $0.004 | $400,000.00 | |
| Community Round | 0.20% | 20 | $0.005 | $100,000.00 | |
| Public IDO Round | 0.83% | 83.3 | $0.006 | $500,000.00 | |
| Play To Earn Rewards Pool | 35.00% | 3,500 | |||
| Staking Rewards Pool | 7.50% | 750 | |||
| LP Rewards Pool | 12.50% | 1,250 | |||
| Team | 2.00% | 200 | |||
| Liquidity Provision & Market Making | 2.00% | 200 | |||
| Treasury | 21.97% | 2,197 | |||
| Advisors | 2.00% | 200 | |||
| Marketing & Development | 15.00% | 1,500 | |||
| TOTAL | 100.00% | 10,000 | $1,000,000.00 | ||
| Stage | Listing Release (% Of Stage) | Listing Release (Tokens) (M) | Listing Release (% of Supply) | Cliff | Vesting (Months) |
| Seed Round | 5% | 5 | 0.05% | 6 | 18 |
| Community Round | 10% | 2 | 0.02% | 0 | 6 |
| Public IDO Round | 20% | 17 | 0.17% | 0 | 6 |
| Rewards Pool | 0% | 0 | 0.00% | 3 | 60 |
| Team | 0% | 0 | 0.00% | 3 | 24 |
| Liquidity Provision & Market Making | 25% | 50 | 0.50% | 0 | 12 |
| Treasury | 0% | 0 | 0.00% | 12 | 24 |
| Advisors | 0% | 0 | 0.00% | 6 | 24 |
| Marketing & Development | 0% | 0 | 0.00% | 0 | 48 |
| TOTAL | 73.67 | 0.74% |
Contact
Virtual Reality Jam Inc DBA RealityJam
447 Sutter St Ste 405 #522,
San Francisco, CA 94108
info@vrjam.com
