Tokens Structure
Last updated
Last updated
The tokenomics model is centered on the dynamic interplay between $NIT and Nitro Points, creating an infinite reward cycle that ensures $NIT’s value stability and supports long-term sustainability.
$NIT serves as the native token of the protocol. At the DAO’s inception, $NIT holders will govern essential parameters, including:
Deploying new trading pairs using the token reserve balance.
Allocating DAO grants to support ecosystem expansion.
Adjusting market parameters or disabling borrowing for specific pairs.
Nitro Points are non-transferable reward tokens designed to incentivize platform engagement. They are earned through interactions such as liquidity provisioning, borrowing, and blacklisting of expired debts.
As Nitro Points are earned, they can be converted into $NIT via the rewards contract. For more details, [click here to learn about Nitro Points].
The Treasury Fee Auction (Token Buyback) replenishes the reward contract using protocol-generated revenue (Treasury Fee Share). This process reduces the circulating supply of $NIT while increasing Nitro Point backing in the reward contract.
Auctions are held quarterly on the last Tuesday of the quarter, also known as Nitro Tuesday.
Fee Allocation A portion of the Treasury Fee Reserve is designated for the auction. This amount can be purchased by participants based on their buying power.
Fee Distribution
Liquidity Providers (75%)
75% of transaction fees are directed to liquidity providers, rewarding them for swaps, borrowing, and other interactions.
Treasury Fee Reserve (25%)
25% of transaction fees are reserved for:
Platform development and expansion.
$NIT buybacks, reducing token supply and enhancing scarcity.
Increasing Nitro Point backing in the reward contract to sustain long-term rewards.
Eligibility:
Participants must hold Nitro Points (NP), either as current holdings or as NP earned and converted in the past:
Buying Power Calculation
A participant’s buying power in the auction is determined by their share of the total Nitro Points earned by all interested participants:
Participants sell their $NIT at a premium price defined by the protocol to acquire Treasury Fee shares.
$NIT acquired through the auction by the treasury is directed to the reward contract, replenishing Nitro Point backing and ensuring a continuous reward cycle.
