Written by: KarenZ, Foresight News

In the "Westworld" of cryptocurrencies, "founders cashing out and leaving" and "project teams exploiting investors" have become blatant acts of profit-seeking, chronic problems hindering the development of Web3. Therefore, "token economics" is often seen as an accelerator for team wealth and a litmus test for user confidence.

However, when we turn our attention to Backpack, we see a completely different design: Backpack has chosen a thorny path that directly addresses the industry's pain points: during TGE, all liquidity tokens are given to users, and the team's and investors' returns are completely tied to the company's IPO process.

Backpack's move abandons the haphazard design of "VCs setting up the scheme and retail investors footing the bill." Regardless of its ultimate success or failure, this is a respectable attempt in cryptocurrency history.

Delayed gratification: A long-term game between teams and capital

The most striking aspect of Backpack's token economy is the strict constraints on the returns for the team and investors—no founders, executives, employees, or venture capitalists can directly receive token allocations.

In the words of Backpack founder and CEO Armani Ferrante, the "escape velocity" that Backpack pursues has never been about breaking through a certain number of billions of dollars in market value or reaching a certain number of users as a short-term milestone, but rather about the company's successful IPO in the United States.

All tokens originally intended for "team incentives" and "investor returns" (37.5% of the total supply) were deposited into the company's "corporate treasury," i.e., on Backpack's balance sheet. Even after the successful IPO, these tokens were subject to a lock-up period of at least one year, further eliminating the possibility of "cashing out immediately after listing."

This "delayed gratification" design is the best protection for the long-term value of a project. In the crypto industry, too many projects collapse due to the "short-sightedness" of the team and investors—prematurely selling tokens to cash out, causing the token price to crash, the project to lose user trust, and ultimately leading to its demise. Backpack's approach completely cuts off the path for internal personnel to "cash out in the short term," forcing the team and investors to "stand with the project through thick and thin."

Of course, an IPO is not an easy path. Backpack's founders admitted that an IPO might be just around the corner, or it might be a long way off, or it might not even happen in the end. But no matter the outcome, they will give it their all. This "no pain, no gain" determination makes Backpack stand out among a host of short-sighted crypto projects, but it has also won the trust of users who truly value long-term worth.

User-centric token allocation: Igniting the growth engine with incentives

In Backpack's token economics, all liquidity tokens are distributed entirely to users. Backpack believes that users are the core driving force behind project growth, therefore tokens should serve as fuel to incentivize user participation and drive product development.

• The total supply is 1 billion tokens, with 25% of TGE directly released to the community : 24% to TGE holders and 1% to Mad Lads holders.
• Prior to the IPO, tokens were unlocked through key product milestones (37.5%) . Each market expansion and new product launch presented an opportunity to incentivize users with tokens, triggering corresponding token unlocks. This design, through a predictable token unlocking model, continuously attracted new users and expanded the community.

More importantly, according to Armani Ferrante, Backpack has set strict constraints for token unlocking: the new ecosystem value generated by token unlocking must always be greater than its dilution effect on the token price.

This design not only safeguards the core interests of users but also ensures that the long-term value of the project is not diluted by short-term unlocking behavior, allowing token incentives to truly become a catalyst for platform growth and achieving a win-win situation for all three parties: user benefits, ecosystem value enhancement, and project growth.

Under the premise of compliance: slow is fast

Besides its innovative token distribution, another distinctive feature of Backpack is its commitment to compliance. This stands in stark contrast to the industry's prevailing logic of "expansion first, compliance later" and "emphasizing scale over compliance."

According to Armani Ferrante, "Backpack currently only serves about 48% of the world's regions. Behind this seemingly slow expansion lies a pursuit of compliance."

This strategic choice may lead to missed market opportunities in the short term, but from a long-term development perspective, it is key to building a barrier of trust.

Currently, Backpack positions itself as a compliant crypto exchange, offering cryptocurrency spot, derivatives, and lending services. However, it is not content with being just a pure cryptocurrency exchange; instead, it is committed to building a compliant platform that integrates crypto assets with traditional financial (TradFi) services. To achieve this goal, the team is laying the groundwork for banking globally and plans to gradually launch diversified services such as securities products in the future. In January, Backpack also launched a unified predictive portfolio product using cross-margining and cross-collateralization.

Market Perspective: How to View Backpack FDV?

The market's attitude towards Backpack also reflects the controversy and potential of its business model.

According to Axios, citing sources familiar with the matter, Backpack is in talks for new funding terms, with a pre-money valuation of $1 billion.

On the prediction market Polymarket, market expectations for the Backpack token showed significant fluctuations: the probability of the Backpack token achieving a FDV exceeding $1 billion within a day of listing was 21%, while in November 2025, this probability reached over 80%. This volatility largely stems from the inherent uncertainty of the crypto market and reflects the market's cautious attitude towards the "IPO-linked returns" model.

summary

When tokens become tools for project teams to cash out, and when users become the targets of exploitation, the crypto industry loses its original ideals. Backpack's token distribution effectively physically separates Web2 equity incentives from Web3 token utility.

• For the team: The only way out is to strengthen the product and ensure compliance, until an IPO. If the company fails along the way or cannot go public, the team's equity will be worthless, with no possibility of cashing out.
• For the community: They are no longer a liquidity outlet for VCs. The tokens are purely for user rewards and ecosystem tools, not a cash cow for the team.

Backpack's choice, based on compliance, transparency, and long-termism, redefines the value logic of crypto projects, showing us another possibility for the Web3 industry.

As Armani Ferrante said, "We either go big, or we go home." This statement is not only the declaration of the Backpack team, but also a crucial question for the entire Web3 industry: Do we continue to revel in the speculative bubble, overdrawing the industry's trust and future; or do we, like Backpack, choose the more difficult, slower, but more promising path, using long-termism to reconstruct the industry ecosystem?

Of course, an IPO is no easy task and the road ahead is long and arduous, especially in the crypto industry, which faces multiple challenges including regulation, market conditions, and competition, with unexpected events and uncertainties lurking everywhere.