Recently, Sonic Labs, the organization behind Sonic's Layer 1 blockchain, announced a major strategic shift from emphasizing transaction speed to building long-term business value and token sustainability.

Sonic Labs stated that after claiming to achieve industry-leading performance last year, its next phase will focus on upgrades that deliver measurable financial outcomes, including the launch of new Ethereum Improvement Proposals (EIPs) and Sonic Improvement Proposals (SIPs), reducing token supply, and redesigning the reward mechanism for network participants.

"Every decision we make going forward will be guided by the principle of building real value, with a constant focus on price, growth, and sustainability," said new CEO Mitchell Demeter.

On Tuesday, Mitchell Demeter posted on the X platform that this strategic focus aims to create measurable and lasting value for builders, validators, and token holders. "Our mission at Sonic is to go beyond the hype and build a sustainable business model for Layer 1 blockchains, achieving the creation, capture, and return of true value."

The new fee distribution mechanism upgrade will include a tiered reward system for builders and fixed rewards for validators.

Additionally, Sonic Labs will accelerate the automatic destruction of Sonic (S) tokens, permanently removing tokens from circulation to tighten supply.

Sonic claims to be the fastest Ethereum Virtual Machine (EVM) chain in the world, with a "real" finality of 720 milliseconds (ms)—a guarantee that transactions are irreversible, which occurs after a transaction is added to a block in the blockchain ledger.

Since its testnet achieved 720 ms finality on September 8, 2024, the project has garnered attention in the crypto industry.

Meanwhile, to further expand into the U.S. market, Sonic Labs also announced it will establish an office in New York, refocusing on "institutional participation and policy relations" to strengthen its expansion in the U.S. market.

Mitchell Demeter added that this is his first public statement as CEO: "Part of this expansion is to build our institutional sales team and collaborate with investors and business partners looking to adopt blockchain infrastructure."

This news may be a good sign for Sonic token holders. According to data from crypto intelligence platform Nansen, since the protocol rebranded from Fantom in January, the token has plummeted, dropping over 80%, with more than a 20% decline in just the past month.

Additionally, industry-leading traders known for their returns, or "smart money" traders, have been exiting their positions. This group has sold a total of $245 million worth of S tokens in the past week.

While "price itself is not the goal," the CEO added that Sonic Labs will focus on creating a solid foundation for the long-term growth of the token.

Related: Visa pilots stablecoin payment services for U.S. businesses with fiat funding

Original: “Sonic Labs pivots to a ‘business-first’ strategy, shifting focus from speed to survival”

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