PRO RATA or proportional ratio is defined by Wikipedia as: “In proportionality to some factor that can be accurately calculated”.

Referred to lohncontrol project this means that unsold tokens will be distributed freely to those who bought LOHN Tokens during ITO or Presale, proportional to the number of tokens they hold. The distribution will be done using a very simple formula that contains the following variables:

ST-balance tokens; UsT-Unsold tokens; BT-bought tokens; DTpr-Distributed Tokens pro rata

where the formula will be:

DTpr = UsT/ST x BT

Why tokens unsold during the ITO (Initial Tokens Offering) will not be burned but distributed PRO RATE to those who bought LOHN tokens?



The LOHN Token is a utility token in the sense that it is used to access B2B services from the platform lohncontract.com. As we have highlighted in previous debates, buyers, ie those who launch product orders, have the obligation to immobilize in smart the lohncontrol contract for each transaction a token number equal to the amount that the parties involved in the lohn contract have to pay for the services rendered.

There are two interconnected reasons why we decided that the tokens unsold to be distributed PRO RATA: first, to reward holders that saw and believed in the potential of the project and the second, mitigating the volatility of the commodity.

If the number of tokens in circulation were lower, there would be pressure on the token for liquidity to act on a smaller number of tokens, and the price would increase faster as the value of the queries posted on the platform rose. Although this seems good at first impression it would lead to high price oscillations in sudden liquidity growth situations, such as the release of fixed tokens in contracts and their return to the market.

A larger number of tokens in circulation will reduce volatility and will absorb the price oscillation shock by maintaining a smooth evolution in both directions.

Avoiding such volatility shocks will create predictability and market confidence over the LOHN token.