Proposal : implement a fee for buybacks and burning mechanism on V2
Introduction :
A way to reward the majority of Lenfi holders is to implement an additional fee that applies only on interest for buying back Lenfi on open market and sending the bought Lenfi to a burn adress.
The idea is that by reducing the circulating supply, all the Lenfi holders benefit from the increase in value of the token resulting from the reduction in the supply of Lenfi token.
Reasons :
This feels like a more fair way to « distribute » value to all of the Lenfi holders without needing a staking mechanism that would benefit just a few, would increase the circulating supply and could result in a selling pressure from the stakers who are getting “free Lenfi tokens”.
The idea behind sending the bought Lenfi tokens to a burn adress and not the Treasury is to be sure that a futur vote would not make it possible to reintroduce the burned tokens into circulation.
Implementation :
The way to implement this is by applying a 2% fee on interest or 1.5 Ada minimum, in addtion of all the previously voted fees.
A 1.5 Ada fee should be payed , in Ada, by the borrower when taking any loan from any pool.
When repaying his loan, the borrower pays the difference beetween the 2% interest and the 1.5 Ada he already payed when he took the loan.
If the interest is paid in another CNT token, the difference he will pay for this fee is :
• ((CNT token price x price at the moment of settling the loan) -1.5 ADA) or zero if the value is negative.
If the interest is paid in Lenfi, the difference he will pay for this fee is :
• ((Lenfi price) x (price at the moment of settling the loan) - 1.5 Ada) or zero if the value is negative.
In this second case, the diffrence in Lenfi should be sent directly to the burning wallet.
The idea of paying 1.5 Ada when taking the loan is to bootstap the liquidity for this mechanism.
An exception to this should be : If a loan is liquidated, the remaining fee is canceled.
The interest payed in CNTs, other than Lenfi, should be sold every epoch on the open market in a way that the slipperage never goes over 2% per CNT.
The moment of selling the CNT on the open market should be chosen at random during the epoch, i propose different moments per different tokens in a way that the slipperage never goes over 2%
(multiply the number of transactions per token if quantity of tokens to sell makes the slipperage > 2%)
The moment of buying the Lenfi on the open market should be chosen at random during the epoch in a way that the slipperage never goes over 2%
(multiply the number of transactions per token if quantity of tokens to sell makes the slipperage > 2%)
The amount of LENFI bought should be sent to a burn adress.
This adress shouldn’t be accessible by anyone, including team members.
- Approve
- Disapprove
- Abstain
, but i don’t think that will have lots of burning, the idea was not to introduce the tokens in a future vote, if community wants more, they can vote for treasury funds to be allocated to whatever purpose, treasury has plenty of Lenfi.