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A New Economic Paradigm

Zooming in on ATLAS Emissions over time & The Post-Starbased Economy

With the release of SAGE: Starbased on April 2nd, the economic engine of Star Atlas will effectively be replaced. Depending on the Econ team’s objectives, of course -combined with how well they managed to tweak the levers- we will likely see significant price movements of the R27 (raw + compound materials & components) and SDUs.

The imminent end of Faction Fleet and the removal of mining ships from Faction Claims, signal the end of an era in which the team offered an easy way to earn ATLAS within Star Atlas passively. We are entering a new phase in which in-game activity is the only way to earn a slice of the ATLAS emissions. 

Of course, with 3rd party tools for rental & lending being worked on, options to profit passively within the Star Atlas ecosystem will likely make a come back sooner rather than later. But in this case, those earnings will be generated by players putting in the work through gameplay instead.

Starbased itself will introduce a completely new approach to ATLAS emissions that players need to understand in order to stay profitable.

The goal of this guide is to improve your understanding of the post Starbased economy and, through that, help you better prepare for what is coming!

VZUS solos engine [Concept Art] - by Vertpaint Studios
Over the next two weeks, the economic engine will be replaced! – [Showing concept art for the VZUS solos engine – by Vertpaint Studios]

Easing Into It

The team announced recently that the economic overhaul won’t be a big-bang event. Instead, there will be a 2-week grace period, during which Starbased, old SAGE Labs, and Faction Fleet will all be available in parallel, offering ATLAS emissions side-by-side. This allows players and asset owners to find their footing in Starbased before the training wheels come off on April 16th.

During that time, Faction Fleet will, however, see a 50% reduction in ATLAS emissions (33% from where it started out), meaning everyone’s earnings will be cut in half. Interestingly, the earnings and related mechanics in the current version of SAGE Labs will remain fully functional, allowing players to earn ATLAS in both games without compromise. The earnings potential of neither game will be (temporarily) diminished during this 2-week period, which is the case for Faction Fleet.

Sunsetting Faction Fleet

Besides launching a whole new approach to earning ATLAS with Starbased, another major factor in establishing an entirely new Economic Paradigm is Faction Fleet (also known as SCORE) being sunset with it. This means that players who were earning ATLAS in Faction Fleet (through staking their ships) will have to get involved in SAGE if they want to continue earning ATLAS.

Technically: Faction Fleet will continue to be available on-chain, as such is the nature of blockchain programs. But the team may take down the UI to interface with it at some time further into the future.

Most importantly, Faction Fleet will cease to reward ATLAS from April 16th onward, no matter how many ships you have staked.

For the first 2 years, Faction Fleet was the only source of ATLAS for the Star Atlas community. With the introduction of Council RFRs, a second source was created, quickly overtaking Faction Fleet to become (just barely) the main ATLAS faucet (source of ATLAS emissions). This was, of course, helped by the slashing of Faction Fleet earnings by 33% at the time of its introduction.

chart
Figure 1a – Weekly ATLAS Emissions (claimed) in Star Atlas [provided by Aephia Data Runners]

Nevertheless, the Faction Fleet emissions still represent a little over 1/3 of the total ATLAS emissions at this time. But soon, these will cease, and SAGE will take over completely.

This means there are a whole lot of ships that will have to find a new purpose!

Ship Migration

Through the sunsetting of Faction Fleet, the team hopes and expects that SAGE participation will increase considerably. Players can expect a substantial influx of players and ships into SAGE. In theory, the amount of ships in SAGE could double.

However, some investor-only individuals may choose to sell their ships instead, now that their (more or less) passive earning opportunity has ended. Better automation and (third-party) rental services coming online may dampen this, but this will likely depend on how quickly these tools arrive. In short, it will be interesting to see the effect of this on the marketplace over the coming weeks!

Faction Fleet Emissions

For the sake of drawing parallels in the following sections, let’s briefly look at the structure of the ATLAS emissions for Faction Fleet. These emissions have been directly tied to the number (and type of) ships staked.

For each type of ship, the ATLAS earnings were constant and known. Staking ten Pearce X5 ships versus just one would increase a player’s ATLAS earnings tenfold. On top of that, these earnings did not change over time. There was no formula (or curve) determining the ATLAS emissions for a specific ship on any specific day, it was just a straight line. The emissions per ship stayed constant throughout the entire life-cycle of Faction Fleet, though there were two instances where the team manually intervened by lowering the emissions across the board.

In effect, the ATLAS rewards for a specific ship remained the same between December 16, 2021, when Faction Fleet was introduced, and December 22nd, 2023, when earnings were cut by 33%. Now, on April 2nd, 2024, the emissions will again be cut by 50% (or another 33% from the initial emissions), meaning the remaining emissions until April 16th are 33% of what Faction Fleet originally started out with.

chart copy
Figure 1b – Weekly ATLAS Emissions (claimed) in Star Atlas [provided by Aephia Data Runners]

Keeping the ATLAS reward constant per ship model, of course, meant that the total ATLAS emissions per day would fluctuate. With the team continuing to sell more ships and people staking these, one would expect the total ATLAS emissions to grow steadily over time. However, this was not the case (see the chart above). During most of Faction Fleet’s lifespan, crypto was in a Bear cycle, and ATLAS kept shedding value. This likely resulted in people forgetting (or ignoring) their staked fleet. As a result, the average ATLAS emissions for Faction Fleet stayed relatively constant in 2022, before trending down slightly during the first 3 quarters of 2023.

Controlling Faction Fleet Emissions

Worth pointing out, because this will be a recurring theme throughout this article, is that the total ATLAS emissions for Faction Fleet had a ceiling. The team knew that ATLAS emissions could never exceed a certain threshold because they knew how many ships were out there in the hands of the players and what their offering was on the Galactic Marketplace. In short, the team had full control over this ceiling, as they controlled the sale of new ships. This meant they were able to keep it well below the ATLAS emissions curve defined in their Economics Paper (more on that at the end of this article).

SAGE Today

When SAGE Labs went live in late September 2023, ATLAS emissions in Faction Fleet went down as people removed ships there to use them in SAGE instead (see the above chart). Though players could not earn ATLAS (directly) in SAGE (at the time), they could earn ships and other on-chain assets through the in-game redemption process. They could either redeem crafted resources for a ship directly or get raffle tickets instead, and take a chance to win more valuable assets.

The dip in Faction Fleet ATLAS earnings shows this was a successful strategy. The team effectively supplanted part of their ATLAS emissions by instead emitting ships and other on-chain assets as a reward for actual gameplay.

Mere days before Christmas 2023, the team flipped the switch and—through Council RFRs—introduced ATLAS emissions into SAGE. At the same time, they made ship redemption so expensive that from that point onward, the vast majority of players (> 99.9%) focused exclusively on crafting Council RFRs.

Council RFR Economy

Like the ships in Faction Fleet, each Council RFR was worth a fixed amount of ATLAS. Again, total ATLAS emissions per day would fluctuate based on the number of Council RFRs redeemed (and sold on the marketplace). The more people (and bots) created and sold RFRs, the higher the ATLAS emissions would go.

Here, too, the team put a ceiling in place that they could directly control. Each RFR requires an SDU to produce, and there is a cap on the amount of SDUs that can be produced (found) per minute. This meant the team had a tight grip on the maximum ATLAS emissions associated with this system.

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Star Atlas – Starbased – Kickstarting a new economic paradigm!

Starbased

Starbased will overhaul SAGE earnings completely. Along with the Faction Fleet rewards ending, the team will also remove Council RFRs completely. The new earnings mechanic is a two-phase approach that starts with players earning Loyalty Points (LP).

Loyalty Points

In Starbased, Loyalty Points can be earned by helping your faction upgrade Starbases and maintaining them (paying upkeep).

Just as a constant amount of ATLAS was earned for each ship in Faction Fleet, or for selling Council RFRs, the amount of LP earned for a specific task in Starbased is constant. Contributing 1000 frameworks to upgrading a Tier 3 Starbase will always result in the exact same amount of LP. It does not matter in which faction this takes place, during which epoch, which player does it, or how many other resources are contributed to starbase upgrades during that epoch. The LP earned for that specific contribution will always be exactly the same.

In other words, the more contributions made, the more LP earned. Again, this follows the same approach as ATLAS earnings in Faction Fleet and Council RFR earnings in SAGE.

Of course, the major difference is that LPs are not ATLAS. One more step is required to get your ATLAS, and that is where Starbased deviates from the approaches we’ve seen up until now, in two important ways, as we’ll see below.

ATLAS Emissions

For Faction Fleet and RFRs, there was a ceiling in place, ensuring ATLAS inflation could never run rampant without the team allowing it. In Faction Fleet, this ceiling was never reached. In fact, as time passed, the ceiling went up while ATLAS earnings stayed the same or even went down. Similarly, the amount of Council RFRs sold per day differs wildly, but averaging these out, the numbers stay well away from the ceiling.

The First Deviation:
Starting with SAGE Starbased, the ATLAS emissions will hit the ceiling (max ATLAS emissions) every single day. Put differently, the ATLAS emissions in SAGE are always the same, no matter what the players do. They are constant. This is a major deviation from how the ATLAS emissions worked in Faction Fleet and SAGE before.

ATLAS Earnings

ATLAS in Starbased is not simply earned. Players will have to buy ATLAS in an in-game shop, and the only accepted currency is the player’s Loyalty Points.

This transaction is not immediate. Though the player’s LPs are gone instantly, the ATLAS will only arrive later. On top of that, the player will have no idea how much ATLAS their LP bought them until shortly before they receive it.

The ATLAS distribution will take place at the end of each epoch (currently set to a day, so 24 hours). When an epoch ends, the LP-to-ATLAS conversion program will tally up the total LP spent during that epoch, and calculate each buyer’s piece of the (constant) ATLAS pie—4.5 million ATLAS in total. Then, it will send the players their share of the ATLAS.

In other words, the amount of ATLAS received by an individual player will depend on the total amount of LP spent by all players during that epoch to buy ATLAS. As such, it is not known until the epoch is over and the total amount of LP spent is known.

The economic model of Faction Fleet was one of certainty. The economy model of Starbased is one of uncertainty.

Viktor (Aephia Data Runner)

Faction Earnings

But there is more the team has in store for us!

The Second Deviation:
The ATLAS emissions are not only constant for the whole of Starbased. They are, in fact, constant for each of the three different factions. The fixed, total ATLAS emissions per day are split into three equally sized emission pools, each representing the total ATLAS emissions for players of the respective faction.

Combining all of the above, each faction has its own fixed supply of ATLAS that it emits every epoch to its members. The ATLAS earmarked for each faction is exactly the same amount, 1/3 of the total ATLAS emissions for Starbased. Each faction will send the entire bag of ATLAS to the players from that faction who sold their LP that epoch, split based on the amount of LP sold. After this, the ATLAS bags are refilled and ready to reward players during the next epoch.

Though this is a brand new approach to these ATLAS emissions, the team has been talking about doing things this way since the very early days!

In December 2022, the team released the SAGE Game Manual, which mentions this concept in its last chapter:

Screenshot 2024 03 20 at 16.28.01
Sage Game Manual – Part 2

However, the team was already talking about this concept in 2021. We previously wrote about it in our Faction Selection guide, published in October of 2021:

Screenshot 2024 03 20 at 16.32.52
Star Atlas – Pick a Faction Guide (by Aephia)

In short, this is not something new or unexpected; this was a long time coming!

Faction Balancing

Splitting the ATLAS pie into three equally sized parts and allowing players to earn a piece of those slices creates an auto-balancing mechanism for the factions. This is important in a (future) persistent world, where new players need to be incentivized to join the weakest faction, in order to keep the game fun and thriving for all players.

Donating (say) 500 frameworks to a Starbase Tier 4 upgrade process will always result in the exact same amount of LP earned. But the amount of ATLAS those LPs can get you will differ per faction! This means that at the end of every epoch, it will be easy to figure out the ATLAS value of a single LP for all three factions. Every epoch, there will be one faction where those LPs would have gotten you the most ATLAS.

This means players are financially incentivized to join the faction that (on average) rewards the most ATLAS per LP spent.

It basically ensures that the total amount of activity per faction should not deviate tremendously. After all, if one faction is consistently less active, ATLAS earned per LP spent there should be consistently higher, encouraging new players to adopt that faction.

Earnings & Faction Balancing Example

Let’s look at an extreme example to best illustrate this:

AtlasPerEpoch
Example: Earnings per faction based on LP sold by players, per faction during one epoch

In the above example, the team has set the total emissions of ATLAS/epoch to 4.5 million, meaning the three factions each get a fixed 1.5 million slice or ATLAS to reward their players (this is in line with recent statements made by the team).

During that epoch, the Ustur players collectively spent the least LP to buy ATLAS, only 1 million. In contrast, the MUD spent the most, 100 million. When the epoch ends, the value of a single Loyalty Point can be calculated for each of the factions by dividing 1.5 million ATLAS by the total amount of LP spent in that faction. For Ustur players, their spent LP was worth 1.5 ATLAS each. For MUD players, their spent LP was worth 0.015 ATLAS each.

With (completely fictional and) highly unlikely numbers like these, we would probably see many MUD players setting up a new account in the Ustur faction. But even if the discrepancy would be much less, it’s easy to see how new players would be financially incentivized to join the faction that gives them the best bang for their buck (LP).

Inter-Faction Arbitrage

Beyond balancing faction activity, the way the ATLAS earnings are set up also provides arbitrage opportunities between factions. After all, if one LP is worth different amounts of ATLAS per faction, then the materials spent to gain LP have different ATLAS values for each faction as well.

For example, contributing 10,000 Food to the upkeep of a Starbase in the most active faction will result in the same amount of LP as doing this in the least active one. But the LP itself will be worth more ATLAS (on average) in the latter one.

This means that instead of providing Food within the most active faction, some players in that faction may find it more economically savvy to take their Food out of SAGE and sell it on the Galactic Marketplace (or OTC) to players of the least active faction. After all, that food will result in more ATLAS for them.

Caveats

Arbitrage will likely be relatively straightforward as long as player activity is mostly clustered around each faction’s Central Space Station (CSS). However, transport costs will diminish potential arbitrage profits as soon as that activity moves away from the CSS.

Atlas Earnings
Figure 2 – Daily Atlas Emissions and the 3-month average [provided by Aephia Data Runners]

Starbased Earnings

When we look at the daily average ATLAS emissions since Faction Fleet’s inception, we see that the earnings were trending a little below 5 million ATLAS per day, before going down with the arrival of SAGE and shooting up steeply to 6 million per day after the Council RFRs took over the meta.

Starbased will emit a fixed 4.5 million ATLAS per day, which is slightly below the average daily emissions over the past two years.

Early Days

In the early days of Starbased, one could imagine stockpilers getting in early to sell their stored assets in several chunks as fast as possible. But if they all choose the same day, they push each other’s earnings down. It may be smarter to smear it out, but it will really depend on people’s individual expectations and strategy. This conundrum will be compounded by everyone needing to get up to speed on the new mechanics and formalize a strategy.

Long Term Downtrend

ATLAS earnings will be best early on in Starbased’s lifecycle.

The team’s long-term goal is to make a game that appeals to millions of players. While SAGE’s goals may be, at least at this stage, a lot less lofty, it is clear that the appeal of SAGE should pick up a gear with the launch of Starbased. If all goes well, more players will learn about SAGE over time and jump in. When Combat is introduced next, the appeal should increase even more. This cycle will continue well into the future (at least until Season 5).

As the game becomes more expansive, its appeal grows, word about it spreads further, and more people will join in on the fun.

In contrast, the fixed ATLAS emissions per epoch will (very likely) not change. In other words, as more players come in and total activity goes up, the ATLAS earnings per activity and, thus, per player will start to decrease.

If Star Atlas will only grow more popular over time, then ATLAS earnings will simply keep decreasing.

This is important to understand, as it means it may not be worth it to stockpile resources or LP for the future if ATLAS earnings are your primary focus!

ATLAS Demand

Note that though the amount of ATLAS earned by players may trend downwards, this does not mean the USDC value of those earnings will also trend downwards. With more players coming into the Star Atlas ecosystem, demand for ATLAS may increase, leading to an increase in its USDC value.

Note that this is purely speculative, however!

Secondary Market Implications

Most SAGE players seek to earn ATLAS, either directly in-game or by trading materials on the secondary market. The price of materials on the secondary market, of course, depends on the ATLAS emissions those materials contribute to.

The 27 different materials & components that exist in-game (R27) serve no other purpose now but to use them to redeem various valuable assets. It’s those assets that give the materials their value. With well over 99.9% of the redemptions (ATLAS value) being Council RFRs, it’s that specific asset that is directly responsible for the current valuation of the different materials.

SAGE Redemptions
Figure 3 – Redemptions in SAGE (since launch) [provided by Aephia Data Runners]

Of course, many other factors help determine the value of a specific material at any given time (e.g., supply & demand and the effort required to acquire the material). Those certainly play a role in determining the relative price difference between Material A and Material B. However, the fixed ATLAS value of a Council RFR creates a natural ceiling for the price of the materials required to create an RFR, the so-called Bill of Materials (BOM).

Whenever the BOM becomes more expensive than a single RFR, people will instead sell materials directly until this is no longer the case, providing downward pressure. Whenever the BOM is cheaper than an RFR, people will buy the materials on the secondary market as profit is guaranteed. As such, the RFR creates a price equilibrium within which (over time!) materials can only become more expensive if others become cheaper.

In conclusion, the Secondary Market is not an isolated economy. As the R27 materials are only valuable within SAGE Labs and are used exclusively to redeem Council RFRs, you can not evaluate the Secondary Market prices of the materials in isolation from the ATLAS value of the Council RFR asset. It is this asset that gives the materials their value.

Starbased Economy

When Starbased is launched, the Council RFR will no longer be available for redemption. Simultaneously, all other redeemables will be removed. Instead, in this game, players will craft components they donate to their faction in exchange for LP. Afterward, they can sell LP to earn ATLAS.

This closely mimics the way the Council RFR functioned, and that is not a coincidence. When the team came up with the Council RFR, they already knew where they were headed next. This allowed them to create an intermediate solution to start moving the economy in that direction.

In Starbased, the ATLAS value of LPs within each faction and the material costs to earn these Loyalty Points will determine material prices.

Now, there are two clear points where the new system deviates from the RFR system:

  • Instead of just one redeemable asset (Council RFR), materials can be spent on seven different projects to gain LP (for Tier 1 Starbases, this number grows with higher Tier Starbases). The materials required (BOM) differ greatly between these, meaning we’ll see an interesting price-discovery phase post-launch!
  • As mentioned earlier, the ATLAS value of a single LP differs over time and between factions. This allows for arbitrage and different valuations of certain materials between players.

To conclude, R35 prices (Starbased introduces 8 new materials) will be primarily determined by:

  • the Loyalty Point sources they directly—or indirectly (as part of the crafting chain)—feed into
  • the amount of LP that can be earned with these LP sources
  • the value of a single LP for the three factions

Therefore, anyone who expects to earn less by participating in Starbase upgrades & upkeep than they do now with Council RFRs should also expect material prices to go down on the Galactic Marketplace.

The added complexity will result in more arbitrage and trading opportunities as it obfuscates price discovery.

ATLAS in circulation - source: Star Atlas Economics Paper [Released August 26, 2021]
Figure 4 – ATLAS in circulation – source: Star Atlas Economics Paper [Released August 26, 2021]

ATLAS Emissions

Back in 2021, the team shared their second seminal paper, their Economics Paper. It’s worth a read-through if this is new to you. It contains, among many other things, the above chart depicting the planned ATLAS distribution, including the ATLAS emissions.

Before wrapping up this article, we wanted to briefly look at the originally planned emissions, the past emissions, and the upcoming [Starbased] emissions. To start with the first two, the planned emissions in the Economics Paper are considerably higher than what we have seen so far. Both Faction Fleet and SAGE (Council RFR) earnings have never come close to the ATLAS emissions depicted in the team’s original plan (compare Figure 4 [monthly] with Figure 1 [weekly]).
This is reflected in today’s circulating ATLAS supply, which is 15.4 billion (March 31st, 2024) compared to the ~23 billion planned for in the Econ Paper.

Looking at the future Starbased emissions, emitting 4.5 million ATLAS per day would mean that roughly 137 million ATLAS will be emitted to Starbased players per month. Looking at the Reward unlock curve, this matches the emissions for Q3 of 2027 of the initial plan.

So, past emissions and future emissions will remain well below the originally planned trajectory.

We can only guess why that is the case. A likely scenario is that user adoption did not pick up as fast as the team originally anticipated. No doubt this was in part due to these plans being written at the peak of the crypto bull cycle in 2021, when expectations were rosy. The team was likely also still convinced of their ability to sprint through their roadmap in 5-7 years, with a mission-based mini-game coming out before 2021 would be over.

However, the development speed turned out to be considerably slower than expected, which led to no real gameplay being released during 2022 and a good chunk of 2023. On top of that, most of 2022 and 2023 saw a pretty brutal bear cycle. Ramping up ATLAS emission (essentially inflation) during that phase would have been a pretty bad idea, given the small number of active community members back then.

With development progress being slower than expected and player adoption well below the original targets, it makes perfect sense for the team to keep ATLAS emissions in check and well below their original targets.

So, what will the team do with the ATLAS reserves that are building up? Once again, we can only speculate. Perhaps they will use it to boost ATLAS emissions in the future when user adoption starts to really take off, and/or perhaps they will want to try to increase emission length to cover one or two more years beyond 2029. We’ll have to wait and see!

Multiplayer

Lastly, we wanted to provide a final side note on the gradual shift from single-player to multiplayer.

Where earnings in Faction Fleet and SAGE Labs were really a single-player affair, Starbased decidedly makes it more multiplayer. After all, your earnings are no longer solely dependent on your ships or your in-game activities. They now depend on the activities of others as well.

However, this interaction is still quite indirect. In the future, it will become more direct by introducing features such as combat.

That said, though being indirect, the gameplay Starbased offers does encourage players to connect and strategize. For example, upgrading a Starbase requires people to contribute enough Toolkits (upkeep) to keep the upgrade process running uninterrupted. Overall, it will be interesting to see to which extent players will start organizing themselves!

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