# History of Token Economy Development

Blockchain and the digital virtual economy are rapidly evolving, and the token economy is continuously advancing. Tokens initially emerged from the Proof-of-Work (PoW) mechanism (represented by BTC). Later, with the support of Ethereum smart contracts, ICOs rose, allowing new projects to publicly sell their tokens. Most recently, and closest to NovaBank, is the LP liquidity mining under the DeFi 1.0 mechanism, where users provide liquidity to pools, and the protocol directly rewards them with tokens.

The PoW mechanism is still used on a small scale, such as with Filecoin. ICOs have largely been abandoned by the market. Currently, most token issuances adopt the LP liquidity mining mechanism of DeFi 1.0.
