What is Towns (TOWNS)?
In today’s world, most chat platforms are controlled by centralized companies. User data is treated as a commodity, and rules are dictated from the top down without room for dispute. Now, imagine an online chat room that you truly own, where you can set your own rules, control access, and even earn revenue from members all built on a system that is secure, transparent, and censorship-resistant.
This is exactly what Towns is building powered by blockchain, smart contracts, and DAO-based governance.
Towns (TOWNS) is a group chat platform built on blockchain technology, operating on Ethereum Layer 2 (Base). It enables users to create private, customizable, and decentralized chat rooms called Spaces, each with its own membership system, rules, and governance executed through smart contracts.
From a technical standpoint, the Towns Protocol is an open-source framework that connects:
A Layer 2 blockchain (Base)
A decentralized network of Stream Nodes
Smart contracts that support real-time, end-to-end encrypted communication
Each Space is an on-chain digital asset that its owner controls, including its pricing, access rules, and governance structure.
Core Components of Towns
1. Customized Spaces
Every chat room in Towns, called a Space, exists as an ERC-721 NFT on the blockchain. Owners have full control deciding membership rules, who can join, and assigning different roles or permissions to participants.
Spaces can also be transferred, sold, or delegated to DAOs for community governance. They are designed for seamless integration with DeFi and Web3 applications (DApp integrations).
2. On-chain Memberships
Joining a Space requires a membership token, functioning as a digital subscription. These tokens usually last for one year and can be renewed by members before expiration. This ensures existing members are not “priced out” when demand increases.
Space owners have complete flexibility: they can set the supply, pricing model, and special requirements, such as NFT-gated or token-gated access.
3. Encrypted Messaging
All messages are end-to-end encrypted, meaning only the sender and authorized members can read them. Even the nodes that relay or store the messages cannot decrypt their content, ensuring true privacy and security at the protocol level.
4. Scalable Layer 2 Architecture
Towns runs on Base, an Ethereum Layer 2 built with OP-Stack. This combines Ethereum’s security with faster, cheaper transactions. A distributed network of Stream Nodes handles message transmission, verification, and storage delivering speed, scalability, and decentralization.
5. Decentralized Governance (Towns DAO)
The Towns Protocol is governed by the Towns DAO (or Towns Lodge), a decentralized autonomous organization. Community members including Space owners, node operators, and token holders can collectively vote on proposals and protocol changes. Governance is powered by the TOWNS token (ERC-20), enabling staking, delegation, fee distribution, and full voting rights within the ecosystem.
Pricing and Permissions
Spaces in Towns use Pricing Modules to define membership fees. These can be fixed or dynamic (e.g., logarithmic increases as membership grows). Payments are typically made in ETH, with revenue distributed fairly among the Space owner, Towns DAO, and referrers.
Permissions are managed through Roles and Entitlements, which define user capabilities (e.g., reading, posting, creating channels, or issuing memberships). Entitlement Modules add flexibility, allowing access conditions based on token holdings, wallet addresses, or other on-chain rules.
What Can the TOWNS Token Do?
The TOWNS token is an ERC-20 token on Ethereum, bridged to Base, and serves multiple functions:
Staking & Delegation Rewards: Support node operators or Spaces that secure the network.
Governance: Vote on protocol-level proposals and policies.
Tokenomics: Starts with 8% annual inflation, gradually decreasing to 2% over 20 years, with inflation managed by the DAO.
Rewards System: Bi-weekly distributions to node operators and TOWNS stakers.
Token Distribution
Community Reserve: 43.14%
Team: 21.46%
Investors: 13.74%
Airdrop: 9.87%
Nodes (Year 1): 7.90%
Public Investors: 2.62%
Node Inflation: 1.27%
Total Supply: 10.12 billion TOWNS, Circulating Supply: 2.1 billion TOWNS
Conclusion
Towns (TOWNS) is revolutionizing online communication by using blockchain to create a platform that is private, secure, user-owned, and censorship-resistant. With customizable Spaces, tokenized memberships, end-to-end encryption, scalable Layer 2 infrastructure, and DAO governance, Towns empowers communities to take control of their conversations.
Instead of being run by a centralized corporation, Towns is built to be fast, secure, and community-driven, a chat platform truly owned by its users.