[Hilarium ICO Talk] Behavioral Psychology of Token Economy

Hello Everyone, this is Chris Kim from the HILARIUM FOUNDATION. 

Token Economy, a concept originated from behavioral psychology, is an economic principle based on B.F.Skinner’s Operant Conditioning theory.

The method is to provide “tokens” as a reward to induce a certain action, and allow the token to be exchangeable for something of value.

For example, if a child brushes his teeth regularly, we give tokens as rewards. 

10 tokens will be exchangeable for a chocolate, and 20 tokens will be exchangeable for a toy. 

As a result, this token will help lead him to an appropriate life habit.

The fundamental idea of the Token Economy is to reinforce desirable behavior with a reward of tokens.

In order to encourage certain behavior, sufficient rewards must be given, and the token exchange process must be reasonable.

Token Economy, however, may face some problems. 

This happens when the token exchange value is irrational, the issuance, payment, record of token are not transparent, the token exchange banner is in consistent, and so on. 

If the reward for the action is too small and inconsistent, the effect of the Token Economy will be halved.

The technical characteristic of the blockchain, which discloses all transaction details to the general ledger and is systematically fair without the need of the central entity’s trust, is an optimized means of Token Economy.

Primarily, the purpose of the Token Economy is to extend the network through incentives.  

It gives incentives for users to use the network (behavior enhancement), and with more users, its usability and versatility improve. Consequently, the value of tokens increases, leading to more incentives. 

As those who join the network early have a higher chance to receive more incentives, the problems of user influx and network organization can be solved.

Hilarium is creating a new ecosystem of reward business models through blockchain-based Token Economy.

Hilaris and H-CMP will provide incentives for accurate exercise and healthy life; in consequence, many people will join the network and raise the price of Hilarium Coin, giving higher chances for the initial participants to receive even more incentives. 

Hilaris’s Business Model through Token Economy

Hilarium will introduce the concepts of CCM(Certificate of Coin Mining) for the Coin holders of Blockchain technology and PoX(Proof of X-Activity) to enhance the healthy life behavior of the users. By doing so, Hilarium will rise to the center of Token Economy.