How to maintain FDOGE pegged to 1 FTM?
FDoge Finance Protocol
- When FDOGE trades below the 1 $FTM target price
When FDOGE price is below the target price of 1 $FTM, token holders can purchase FDoge Bonds (BDOGE) by burning FDOGE to reduce the circulating supply with a 1:1 ratio, and Bonds will be burnt when users redeem FDOGE with a premium bonus.
- When FDOGE trades above the 1 $FTM target price
When FDOGE price is above the 1 $FTM peg, the token supply will have to expand to push it back down to 1 $FTM and the contract will allow the redemption of the BDOGE. When the price of FDOGE continues trading above the 1 $FTM target price after bond redemption, the contract mints an appropriate amount of new FDOGE. This will be distributed to the Boardroom Stakers.This three token system creates incentives through seigniorage, always pushing FDOGE towards its peg. SDOGE is used to redistribute the seigniorage from inflating the asset, while FDOGE is used to establish a price floor while FDOGE is in its deflationary state.
- Epoch Expansion
Epoch Expansion: Current expansion cap base on FDOGE supply, if there are bonds to be redeemed, 65% of minted FDOGE goes to treasury until its sufficiently full to meet bond redemption. If there is no debt it will follow max capped expansion rate
- Under 500k 4.50% Cap
- 500k+ 4.00% Cap
- 1m+ 3.50% Cap
- 1.5m+ 3.00% Cap
- 2m+ 2.50% Cap
- 5m+ 2.00% Cap
- 10m+ 1.50% Cap
- 20m+ 1.25% Cap
- 50m+ 1.00% Cap
- BDOGE tokens do not expire and this greatly reduces the risk for bond buyers
- Price feed oracle for TWAP is based on the average of 3 liquidity pool pairs (i.e. FDOGE/2OMB, FDOGE /3OMB and FDOGE /FTM) which makes it more difficult to manipulate
- The protocol keeps 80% of the expanded FDOGE supply for SDOGE boardroom stakers for each epoch expansion, 18% toward FDOGE DAO Fund. During debt phase, 65% of minted FDOGE will be sent to the treasury for SDOGE holders to participate in bond redemption.
- No discount for bond purchase, but premium bonus for bond redemptions if users were to wait for FDOGE to increase even more than the 1 $FTM peg
- Riding on FDOGE ecosystem’s various resources and ecosystem pillars, FDOGE will find its ever growing utilities right after launch, which is its great advantage over other algorithmic stablecoins pegged to $FTM.