> For the complete documentation index, see [llms.txt](https://docs.lambda.markets/lambda-markets/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.lambda.markets/lambda-markets/powered-by-lmda/the-lmda-token/token-flow-and-utility.md). # Token Flow & Utility {% hint style="warning" %} The Lambda Vault burn mechanism will determine $LMDA scarcity. {% endhint %}

LMDA total supply should decline as the platform user base grows

## Token Flow in the Lambda Ecosystem Users must acquire + activate $LMDA tokens to interact with the Lambda 2.0 platform. $LMDA tokens once activated, are sent to the ‘Lambda Vault’ — that’s where the deflationary mechanism begins… Availability of the LMDA token on decentralised markets should become increasingly scarce, promoted via a **token burn mechanism.**

**10% of the LMDA tokens used to activate product features** will be burnt, beginning at launch & lasting FOREVER. Once tokens are deposited into the vault, 10% of those tokens are burnt — never to hit the market again.

{% hint style="success" %} As the Lambda user-base and platform grows — availability of the LMDA token on decentralised markets should become increasingly scarce. {% endhint %} ## The Impact of LMDA price on supply The price to unlock platform features + subscriptions are pegged to USD values but are **paid by users in $LMDA**. If $LMDA trades at a discount, the number of tokens required for access becomes higher and thus **more tokens are burnt in the Lambda Vault.**

Platform features are pegged to USD but paid for in LMDA

$LMDA burning will commence when the $LMDA token portal closes on January 7th 2023 → this is where those who are early will realise the value of the launch burn.

As LMDA price decreases, tokens required for platform access increases

As LMDA price decreases, tokens required for platform access increase and so too do the number of tokens burnt for each feature activation 🔥

## LMDA Scarcity During renewal periods and new platform feature releases there should be heightened demand for activated LMDA + thus the availability of the LMDA token on decentralised markets should become increasingly scarce **in short bursts throughout the year.** The beauty of floating 90% of the LMDA token supply to users at launch is that we are able to promote a consistently deflationary market — instead of one that is ridden with inflation.