Behind the 25% TGE: Backpack is betting on an "IPO narrative".

Author: 137Labs

With 25% TGE, 24% user allocation, and IPO-linked unlocking, Backpack's token economics is challenging the traditional token issuance logic of exchanges. Starting as a wallet and NFT community, obtaining compliance licenses, acquiring European entities, and tying its token to IPO expectations, Backpack is betting not just on traffic, but on a capital market narrative. Is this structural innovation, or a high-risk pricing strategy? This article provides an in-depth analysis of its team background, development path, and token model.

While most exchanges are still designing token models around fee discounts, buybacks and burns, and ecosystem incentives, Backpack has chosen a completely different path.

Total supply: 1 billion units.

TGE release 25%.

The token structure is deeply tied to the IPO process.

This is not just a token distribution scheme, but more like an experimental model that integrates corporate capital structure with token economics.

If we look at Backpack's development history, team background, compliance path, and this token design together in the same diagram, we'll find a more fundamental issue:

Is Backpack issuing its own cryptocurrency, or is it setting up an equity structure for a digital asset company that may go public in the future?

I. Development Path: The Three-Stage Evolution from Wallet to Exchange

Backpack didn't start with exchanges, but rather with a wallet product built around xNFT.

Phase 1: xNFT and Web3 Application Containers

Early versions of Backpack featured support for executable NFTs (xNFTs) as their core selling point.

This design allows developers to embed application logic into NFTs, making the wallet a container for running Web3 applications.

At that stage, it was more of a technology-driven infrastructure company than a financial platform.

The keywords are:

Developer ecosystem

On-chain application distribution

User operating system

This is the starting point for product-driven development.

Phase Two: Mad Lads and Community Assets

The launch of Mad Lads NFTs marked a key turning point.

It has not only become a representative NFT project in the Solana ecosystem, but also established an active community asset pool for Backpack.

The strategic significance of this stage lies in:

Establish an identity system

• Gathering core users

• Build brand equity

This represents a leap from "tool products" to "platform ecosystems".

Phase Three: Exchange and Compliance Expansion

The narrative shifted dramatically after Backpack received regulatory approval and officially launched its exchange business.

It's no longer just a wallet.

It became a centralized trading platform with compliant status.

This stage means:

Entering a highly regulated sector

• Assume responsibility for asset security

• Directly participate in market competition

The shift from a technology company to a financial platform is a crucial step in determining its valuation logic.

II. Team Background: Entrepreneurs who emerged from the FTX era

Backpack founder Armani Ferrante previously worked at Alameda Research, and some team members also have backgrounds that overlap with the FTX system.

After FTX crashed, "former FTX background" became a sensitive label.

Backpack's approach is not to avoid challenges, but rather to build credibility through action.

During its European business restructuring, Backpack participated in the acquisition of relevant entities and facilitated the return of user assets. This was both a business move and a way to repair its reputation.

This gives the team three unique qualities:

• In-depth understanding of exchange mechanisms

• Have a realistic understanding of risk control failures

Highly sensitive to compliance and regulation

This complex background makes its path more inclined towards stable financial institutions rather than aggressively expanding trading platforms.

III. Financing and Capital Narratives: The Shift in Valuation Logic

As the exchange business progresses and licenses are issued, Backpack's valuation logic has changed.

from:

"Wallet + NFT Project"

Turning point:

"Compliant Exchange + Potential Unicorn Platform"

At this stage, the core variable determining its long-term value is no longer on-chain activity, but rather:

Actual trading volume

·market share

• Regulatory expansion capabilities

Profit Model

This also laid the foundation for the subsequent token structure design.

IV. Deconstructing the Token Economic Model: Three-Stage Structure and IPO Binding Mechanism

Backpack has a total token supply of 1 billion, but the real key is not the quantity, but the distribution structure.

The entire model is broken down into three distinct phases:

1. TGE (Initial Release)

2. Pre-IPO (Pre-IPO stage)

3. Post-IPO (Post-IPO Stage)

This is a token system built around the company's development timeline.

Phase 1: TGE – 25% Initial Release

25% of the total supply, or 250 million tokens, will be released during the token generation event phase.

in:

Approximately 240 million tokens were allocated to participants in the points system.

Approximately 10 million Mad Lads NFTs were allocated to holders.

This stage is essentially a settlement of early user behavior.

The points system accumulates rewards through transactions, activity levels, and ecosystem participation, which are ultimately converted into real tokens. NFT holders receive additional incentives as early adopters.

This design strengthens the community aspect and also means that the initial circulating tokens are mainly in the hands of users.

However, TGE will inevitably face a certain amount of potential selling pressure afterward.

Phase Two: Pre-IPO – 37.5% Growth Triggers Unlocking

The pre-listing phase accounts for 37.5% of the total supply, approximately 375 million units.

This phase is not released linearly over time, but rather through a growth-triggered mechanism.

Token unlocking is linked to the company's development progress, including:

Regulatory Progress

• Market access breakthrough

Product line expansion

New asset class integration

From a strategic perspective, its expansion goals may include:

Equity assets

Bank card system

Precious metal products

Major jurisdictions such as the United States, the European Union, and Japan

It is worth noting that these tokens are also distributed entirely to users.

In other words, prior to the IPO, a total of 62.5% of the supply will enter the community system.

Phase Three: Post-IPO – 37.5% of company assets are locked up.

The remaining 37.5% of the tokens went into the company's treasury.

This section has two key features:

• Fully locked up before the IPO is completed

• It still takes a year after the IPO for liquidity to become available.

More importantly, the team and investors did not have separate early token allocations.

They gain token exposure through the company's treasury, which is tied to the company's IPO process.

This means:

Internal interests are postponed and strongly tied to long-term compliance paths.

In summary, this three-stage structure exhibits distinct characteristics: over 60% of tokens will enter the community through airdrops and growth incentives before the IPO, while the interests of the team and investors are postponed and tied to the IPO timeline. Internal liquidity is significantly compressed, and short-term selling pressure primarily comes from users rather than internal members. The entire model is not designed around market cycles but rather around regulatory progress and capital market pathways; its key variable for value realization lies in whether the company can continue to expand and ultimately complete its IPO narrative.

V. Backpack's core proposition: Stock exchange, or future publicly traded company?

Compliance licenses, European business layout, IPO-linked token structure, and high user allocation—these elements together constitute a clear direction.

Backpack is more like a digital asset finance company that is building a global compliance framework.

The role of tokens in this context is no longer just as a means of charging fees, but rather as an integral part of the company's growth narrative.

This is an attempt to integrate the traditional exchange model with the capital market structure.

VI. Risk and Game Theory

Any sophisticated narrative structure carries high risks.

Initial flow pressure

With a circulating share ratio of 25%, which is not low, if the valuation is too high, the market will face selling pressure.

IPO uncertainty

If the listing plan is delayed or not realized, the core anchor of the lock-up logic will be weakened.

Changes in the regulatory environment

The global regulatory landscape is still evolving, and there are uncertainties surrounding cross-jurisdictional expansion.

VII. Conclusion: A Bet on Future Pricing Power

Backpack's token design is not simply an airdrop.

It was a structured experiment:

Use 24% to cash out early traffic.

Lock in 75% of the future time.

Connect tokens with company growth through IPO expectations.

This is a "time for space" strategy.

If the platform's transaction volume continues to grow and compliance progresses steadily, the token may become a mapping asset for the company's expansion.

If growth stagnates or the narrative falls short, a high circulation ratio will amplify market volatility.

Backpack is betting more than just whether its coin issuance will succeed.

It is trying to answer a bigger question:

During a period of strengthened regulation and a return to rationality in the capital market,

Can cryptocurrency exchanges use token structures to transform themselves into genuine financial institutions?