Token Rarifaction Process
Principles
Controlled Supply and Volatility
The protocol aims to control token supply and market volatility to enhance long-term token value.
By withdrawing small portions from the 50-50 liquidity pool and reinjecting the token's value, the protocol seeks to increase token liquidity value while acknowledging short-term volatility implications.
Incremental Destruction and Liquidity Enhancement
The withdrawn tokens will be destroyed, reducing the overall token supply and increasing the value of remaining tokens in circulation.
By maintaining a constant number of tokens in the liquidity pool but reducing the total token supply, the protocol increases liquidity value and potentially enhances long-term token performance.
Long-Term Strategy
The Token Rarifaction Process is a long-term strategy designed to enhance the value proposition of the 0FX token.
By carefully managing liquidity and volatility, the protocol aims to increase the token's value over time, providing sustainable value appreciation to investors.
Implementation
Governance Consensus and Responsible Execution
The implementation of the Token Rarifaction Process will be subject to consensus agreement within the 0FX protocol governance.
Continuous monitoring and traceability will be maintained to ensure responsible execution and prevent excessive market volatility.
Market Adaptation and Long-Term Benefits
Market participants should allow time for the market to adapt to increased volatility resulting from the rarifaction process.
Over the long term, the process is expected to contribute to the protocol's stability and enhance the value proposition for 0FX token holders.
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