Sonic Labs shifts focus to growth rooted in core principles, relying on deflationary tokenomics to ensure lasting value

Sonic Labs, previously known as Fantom, has shifted its approach from emphasizing transaction speed to focusing on core fundamentals under the leadership of new CEO Mitchell Demeter. In an update on November 11, Demeter presented a strategic plan centered on sustainable value, deflationary token economics, and ecosystem growth, marking a more mature direction for the EVM-compatible platform, according to a

. The network, which can process up to 370,000 transactions per second with near-instant finality, is now working to establish itself as a reliable infrastructure provider as the crypto sector increasingly values practical use cases over speculation, as highlighted in a .

A key element of Sonic's new direction is the updated Fee Monetization (FeeM) system, which aims to better align incentives among developers, validators, and token holders. With this revised structure, developers can earn between 15% and 90% of network fees based on transaction activity, validators receive a fixed 10% share, and the rest of the fees are burned to decrease the supply of Sonic’s native token, S, as detailed in a

. Demeter explained that this deflationary approach is intended to support the token’s value and promote a self-sustaining ecosystem. He stated, "Price is a reflection of confidence in our execution," emphasizing that maintaining a strong S token price is crucial for attracting both talent and institutional partners, as mentioned in a .

Sonic’s recent changes build on its rebranding from Fantom in December 2024, which included a 1:1 swap from FTM to S tokens and improvements to transaction throughput, as reported by a

. Currently, the S token is valued at $0.14 with a market capitalization of $546.8 million, but its Total Value Locked (TVL) has dropped to $126.65 million from a peak of $1 billion in May 2025, according to the . Analysts such as zethesx have cautiously welcomed the new fee structure, suggesting that the deflationary burns could "benefit the token’s future," as noted in a .

Demeter also shared plans to broaden Sonic’s reach in the U.S. and internationally. The company will open a New York office to strengthen relationships with regulators and institutional investors, and the GMSonic platform will be developed into a resource center for developers and businesses, as described in a

. The CEO pointed out that Sonic’s "robust treasury" and absence of liquidity issues allow for careful and consistent progress on these initiatives, as stated in the . plans to implement Improvement Proposals (EIPs) and launch its own Sonic Improvement Proposals (SIPs) to upgrade developer resources and boost interoperability, as mentioned in a , positioning itself as a rival to Ethereum and , according to a .

Although Sonic has shifted its strategy, it still faces market headwinds. The S token has dropped 2.21% over the past day, as reported in a

, and its TVL remains well below its previous high. Nevertheless, Demeter emphasized that "this market cycle will be shaped by strong fundamentals, transparent economics, and reliable execution," in contrast to the speculative trends of earlier cycles, as reported in the . The platform’s 24-hour DEX trading volume is $14.71 million, as indicated in the , reflecting steady, though moderate, activity.

Feedback from both the community and institutions has been generally favorable, though some remain cautious. Route2FI commended Demeter’s recognition of the importance of S token price, as reported in the

, while others argue that concrete progress is needed to reverse the TVL decline. Ultimately, Sonic’s future will depend on its ability to deliver on its roadmap—from implementing the new fee model to expanding globally—while navigating the volatility that characterizes the crypto industry.