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Plenny Token

To link the LN with Ethereum, the Plenny Community has implemented a token called “Plenny” using the ticker symbol “PL2.” It is vital to note that Plenny-token is not a replacement for bitcoin. Instead, Plenny is a complementary currency to enable interoperability with Ethereum. Considered across both chains, the users of Plenny are embedded in a dual token structure that relies on bitcoin in lightning payment channels while utilizing PL2 in the Ethereum ecosystem. The token contains utility and payment features that facilitate the following:

  • Rewards for providing lightning services and payments for using lightning services.
  • Rewards for running the Decentralized Oracle Network (DON) through its auxiliary component (i.e. DLSP module).
  • Locking of token for down payments in the capacity market and for locking token as PoS.
  • Staking of tokens for Fish Farming and DAO Governance to receive rewards.
  • Payments of fees.

In general, the token is used to incentivize participation. Specifically, PL2 is the default payment option on the capacity market. In this regard, the token adds specific utility by being the payment method for licensing transaction data services via payment communication channels on a P2P basis (i.e. non-financial digital goods and services). Moreover, the token serves as a reward on the decentralized oracle network and for the different use cases via the Ethereum ecosystem on a P2C-basis, including governance.

Categorically, the legal clarifications indicate that PL2 is neither an investment in a company nor a share to participate in potential profits from the efforts of others. According to the distinguishing features of the Howey Test, three out of four relevant criteria are not applicable. Therefore, Plenny cannot be classified as an asset token or a “security token.” Instead, PL2 is classified as a “hybrid token” with utility and payment features as its central functions.

In terms of legal compliance, it nevertheless remains worth mentioning that PL2 is used differently by Lightning Nodes and LPs as well as governors. For one, Plenny is a hybrid token that provides utility and payment functions; for another, PL2 is a payment and governance token deployable on decentralized applications and markets. Within given circumstances, each has different regulatory implications. Fundamentally, Liquidity Makers and Lightning Oracles operate in the non-financial digital economy. These participants provide lightning services on the one hand by licensing channel capacities and on the other hand by validating payment channels. In contrast, Liquidity Providers (LPs) are related to the decentralized financial economy. LPs allocate cryptocurrency via AMM-protocols to enable decentralized financial activity. The token's governance functions also fall into this category. These two types of economies (i.e. non-financial digital economy versus decentralized financial economy) differ from a functional and consequently from a legal point of view.

Plenny interconnects the various token classifications and use cases. In this respect, the Plenny experiment seeks to discover and bring together synergies so both economies benefit from each other. By using PL2 as the default payment method, participating Lightning Nodes can achieve economic benefits, as is potentially possible for LPs via decentralized markets. Since the volumes of the non-financial digital economy are lower compared to the volumes of the decentralized financial economy, Plenny features are designed to balance the different conditions to support the services provided by participating Lightning Nodes.