> For the complete documentation index, see [llms.txt](https://docs.mangata.finance/welcome/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.mangata.finance/welcome/litepaper/testnet-mgx-tokenomics.md).

# TESTNET MGX Tokenomics

{% hint style="danger" %}
MGX is a testnet token that serves for testing of core features of gas-free swaps and MEV prevention. The main token of Mangata is MGA, which will be released in the future.
{% endhint %}

{% embed url="<https://youtu.be/kHyF0lyllyg>" %}

### Tokenomics Summary

#### Ticker, Initial Supply, Hard Cap

The ticker of the native token of **Mangata X** is **$MGX**. At TGE, it had a **total supply of 1bn MGX**. Rewards are issued up to a **capped supply of 4bn MGX**, which will be reached at the earliest in 5 years. 80% of the final supply of tokens is reserved for the community.

#### MGX Utilities

* **use in Proof-of-Liquidity staking to secure the network:** as this activity is also incentivized, there will be strong demand to provide liquidity for collator nodes.
* **liquidity base layer:** as a lot of liquidity concentrates around MGX, this will offer a lot of short trading routes through MGX, establishing a base layer of liquidity.
* **algorithmic buy & burn:** to continuously offer validation rewards to secure the network against front-runners, we take a small part of the exchange commission to buy & burn MGX.
* **Governance:** managing the diversified treasury and DEX-owned liquidity, as well as liquidity mining incentives and validation rewards, will be a political task that creates demand for liquid MGX.

#### Exchange Commission & Fees

**The Exchange Commission** on trades is 0.3%, of which

* 0.2% go to liquidity providers,
* 0.05% to the Treasury
* 0.05% are used for algorithmic buy & burn.

#### Token Distribution

**80% of all tokens are allocated for the Community**, with the main portions allocated for securing the network and providing liquidity. The rest of the community portion is awarded for supporting the network via crowdloans and other activities.

<figure><img src="https://3624648318-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FLbqvmGewRWFC8kc3j3Y5%2Fuploads%2F1hH9cQq2OCXPwDd3FbpH%2Ftoken1.png?alt=media&amp;token=f55cd3a5-818d-4c84-9a20-c7e8fd74b215" alt="" width="375"><figcaption></figcaption></figure>

#### Emission Schedule

The token emission schedule will reach the **capped supply earliest after 5 years**. Algorithmic Buy & Burn can push this date back into the future.

Below you can find a projection of the circulating supply until the hard cap is reached:

<figure><img src="https://3624648318-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FLbqvmGewRWFC8kc3j3Y5%2Fuploads%2FeCz0GS6EbIp4vCbkUHY9%2Ftoken2.png?alt=media&amp;token=994e254c-feef-4e87-bd7a-0b56615a6f31" alt=""><figcaption></figcaption></figure>

This chart shows the projected circulating supply:

<figure><img src="https://3624648318-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FLbqvmGewRWFC8kc3j3Y5%2Fuploads%2FRvx3A6hLMeJz6cGYv0kD%2Ftoken3.png?alt=media&amp;token=782513ef-6bba-41d1-87dd-f5e1d3f315cb" alt=""><figcaption></figcaption></figure>

This chart shows the projected distribution schedule:

<figure><img src="https://3624648318-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FLbqvmGewRWFC8kc3j3Y5%2Fuploads%2FM9BxcPybtVDPP3Mij91r%2Ftoken%204.png?alt=media&amp;token=4cbf00fd-f1b7-4b17-bf45-77b0a4930334" alt=""><figcaption></figcaption></figure>