xNIT → $NIT

xNIT are governed by two key formulas: the pricing formula (P) and the exchange rate formula (ER).

Pricing Formula

The pricing formula determines the relative value of xNIT to NIT in the reward contract.

$P = \begin{cases} \dfrac{xnt}{nt} & \text{if } nt > xnt \\ 1 & \text{otherwise} \end{cases}$

where:

• $xnt$ = Total amount of xNIT in circulation.

• $nt$ = NIT in the reward contract.

• 1 = ceiling price

Exchange Rate Formula

The exchange rate formula calculates how many Nitro Tokens can be claimed for burning a given amount of xNIT $(∆xnt)$

$ER = \min\left(\dfrac{xnt-∆xnt }{nt }, 1\right)$

where:

• $Δxnt$ = xNIT to be burned.

• $xnt$ = Total amount of xNIT in circulation.

• $nt$ = Total NIT in the reward contract

• 1 = ceiling price

Examples

Given Values:

• Nitro Tokens in the reward contract (nt): 4,000,000

• xNIT in circulation (xnt): 2,000,000

• xNIT to be burnt (∆xnt): 500,000

Pricing Calculation:

• $P = \left(\frac{2,000,000}{4,000,000}\right)$ = 0.5

Exchange Rate Calculation:

• $ER = \min\left(\frac{2,000,000-500,000}{4,000,000},1\right)$ = 0.375

Amount to Claim:

The number of Nitro Tokens $(∆nt)$ claimable for burning $(∆xnt)$ xNIT is given by:

$Δnt=ER×Δxnt$

• $∆nt$ = $0.375\times500,000$ = 187,500

The user claims 187,500 NIT for burning 500,000 xNIT