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Fluid Algorithmic tokenomics
aETH token is designed to be used as a medium of exchange. The built-in stability mechanism in the protocol aims to maintain aETH peg to 1 ETH in the long run. This is achieved by having algorithmically determined contraction and expansion phases to adjust the supply of AETH to bring it closer to peg.
When AETH time weighted price average (TWAP) is above 1.01 ETH the protocol is in expansion phase. This means the total supply of AETH will expand every EPOCH *TIME to bring price closer to peg. This expansion is distributed to WHALE stakers every epoch that we are in expansion phase.
Tokens will not be minted at epochs when twap is below ETH Current Market Price (Peg).
In Epochs the protocol is below peg token holders will burn AETH to purchase BETH . This will lower the supply and help bring AETH back up to peg. BETH can be redeemed for AETH at a premium once we are back in expansion phase.
Note that AETH actively pegs via the algorithm, it does not mean it will be valued at 1 ETH all times as it is not collateralized . AETH is not to be confused for a crypto or fiat-backed stablecoin.
WHALE are one of the ways to measure the value of the Atlantis Finance Protocol and shareholder trust in its ability to maintain aFISH close to peg. During epoch in expansion periods the protocol mints aFISH and distributes it proportionally to all WHALE holders who have staked their tokens in the Boardroom.
WHALE holders have voting rights (governance) on proposals to improve the protocol and future use cases within the Atlantis finance ecosystem.
WHALE has a maximum total supply of 100,000 tokens distributed as follows over X time:
- 30% - 30,000 WHALE will be allocated to DAO Fund & Dev Fund
- 70% - The remaining 70,000 WHALE will be allocated to incentivize Liquidity Providers
Bond ETH (BETH) main job is to help incentivize changes in AETHsupply during an epoch contraction period. When the TWAP (Time Weighted Average Price) of AETH falls below 1 ETH, BETHare issued and can be bought with AETHat the current price. Exchanging AETH for BETH burns AETH tokens, taking them out of circulation (deflation) and helping to get the price back up to 1 ETH. These BETH can be redeemed for AETH when the price is above peg in the future, plus an extra incentive for the longer they are held above peg. This amounts to inflation and sell pressure for AETH when it is above peg, helping to push it back toward 1 ETH.
BETH will be able to be redeemed after an expansionary epoch. Every epoch expansion period a % of the AETH to be minted for WHALE stakers will be claimable by bond holders instead. This is know as the debt phase. After all bonds are redeemed WHALE stakers will receive full share of expansion again.