Fees

The protocol funds itself and its ecosystem entirely through fees. There is no team allocation of tokens. As the protocol grows, it accrues fees, and these are distributed to the ecosystem fund & development team.

There is no "schedule" of token emissions. All tokens are created through the usage of the protocol and scale accordingly.

Fee itemization

There are several fees in place, used as incentives to balance the economic interests of parties.

• Trading (paid in $CHAOS). When buying or selling $CHAOS on the spot market, a small fee is collected. Initial value:

  • AVAX: 0.1% for buys, 0.3% for sells.

  • BSC: 0.5% for buys, 1% for sells.

• Unstaking (paid in $CHAOS). When unstaking $CHAOS, a fee is collected. This is to incentivize long-term staking to gain enough $prCHAOS rewards to balance the fee. Initial value: 0.5%

• $ORDER loan origination (paid in $ORDER). When taking out a $ORDER loan from locked $CHAOS, a one-time flat percentage fee is collected from the total allowable $ORDER. This fee is large in order to disincentivize over-leveraging of $CHAOS loans with $CHAOS purchases. Initial value: 3%

• Ecosystem Growth Fee (paid in $prCHAOS). The protocol mints an amount of $prCHAOS in proportion to net supply of $CHAOS. This dilutionary fee is designed to scale with the health of the protocol. As more $CHAOS gets minted, the same proportion of $prCHAOS is created. In times when $CHAOS is being sold back & burned, no $prCHAOS is generated. Initial value: 8% of net $CHAOS

These fees solely fund the protocol & its ecosystem operations. There are no "protocol tokens" that are portioned out to team members, insiders, or investors.

Revenue distribution

The Ecosystem Growth Fee (all in $prCHAOS) is used to fund $prCHAOS emissions on secondary markets & protocols. For example, $prCHAOS reward emissions for providing liquidity to an AVAX-CHAOS pool would be funded through these fees.

By redirecting the $prCHAOS from the protocol to external markets, the accounting for emissions becomes very straightforward and scalable.

• The $prCHAOS emissions to stakers is itself a fixed proportion of the global supply of $CHAOS. This schedule of $prCHAOS scales with the supply of $CHAOS. For example, 0.5% of the current supply of $CHAOS is created as $prCHAOS every day.

• These stakers rewards go entirely to stakers.

• A portion of this $prCHAOS is now deployed to incentivize activity on other protocols. For example, adding liquidity to AMMs, or depositing $CHAOS in Synthetic Or Lending Protocols. This way of rewarding (or "bribing") involvement with other projects scales with the usage of ONC.

• The Ecosystem Growth Fee is a flat rate of net $CHAOS produced. It scales with the total supply of the protocol. This approach ties the rate of $prCHAOS emissions to the actual magnitude of the protocol, rather than putting tokens on an arbitrary timetable schedule.

Fees from trading, $prCHAOS, and $ORDER loan origination go to the funding the development team, marketing, content creation, and bug bounties. These fees are paid in $ORDER & $CHAOS, and are not suitable candidates for emissions elsewhere.