Tokenomics
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MELD Token
Crypto. Fiat. Lend. Borrow. Stake. Earn.
MELD Token
The MELD token is a multi-purpose token on the MELD protocol. Its core functions are:
- Protocol governance
- Incentivization
- Fee reductions
- Protocol insurance
Our token is the medium of exchange under the MELD protocol. Token holders are given incentives to not only utilize their MELD tokens when desirable but to maintain a minimum balance to maximize their future earnings under the protocol. To maintain holding utilization, Staking provides an annual percentage yield (APY), and fee reductions further strengthen the functions of MELD as a utility for lending and long-term appreciation. Additionally, once reaching a significant milestone of decentralization, introducing protocol governance requires maintaining at least a certain fraction of the total supply. The protocol has a fixed supply of 4 Billion MELD tokens with deflationary mechanisms of buybacks and Liquidity pool yield.
Buyback & LP
Buyback and burn schemas have been very successful and popular mechanics in the crypto space, which has historically helped token price appreciation and keeping the tokens scarce.
Burning tokens based on collected fees has some very desirable effects. The approach’s beauty is the inverse correlation between the project’s success and the number of tokens burned, essentially creating a self-regulating mechanism for the total number of tokens in circulation.
With the emergence of Decentralised Finance (DeFi) and Automated Market Makers (AMM) such as UniSwap, however, a new approach has emerged which has the core benefits of the buyback and burn approach, together with the added value of deeper liquidity - buyback and liquidity provision. In this scenario, instead of burning tokens, they are first provided as liquidity for the token on its main AMM market, and then the resulting LP tokens are burned. Thus combining the benefits of the reduced token supply together with deeper liquidity for the token.
In the case of MELD, 20% of all fees collected on the protocol will be used as funds for buyback and LP.
Token Schedule & Allocation
Our token schedule starts after the private sale. 4% of the private sale tokens are released as liquid MELD becoming available for trading platforms. The rewards for participating or utilizing the token provide rewards for staking that amount to 0.10% a day for the remaining number of outstanding tokens in the reward pool. These rewards are distributed to all protocol participants. Further distribution of reward pools will depend on what actions provide the most value and utility to the protocol. Providing low daily amounts of rewards provides that the outstanding tokens have a technically perpetual amount by always distributing 0.1% of outstanding rewards. The chart below depicts our pool distribution, the token inflation consequence, and its proportional allocation to our total supply.
Team members, advisors, and partners have a lockup period of 9 months from token launch and then begin their 4% vesting per month.
Incentives for Platform Participants & Inflation
MELD will incentivize platform participants via its reward pool. The exact actions will be incentivized and the exact incentive amounts will be up for governance, but some examples include:
- Providing platform liquidity
- Taking loans
- Participating in governance
- Providing liquidity for the MELD token
The rewards for those actions will be taken from the Reward pool. Every day 0.10% of the outstanding tokens in the reward pool will be distributed amongst all platform participants. The exact further distribution of that 0.10% will depend on which actions currently bring the most value to the platform.
Having 0.10% distributed from the outstanding tokens in the pool means that the pool is technically perpetual (e.g. it never depletes) but the rewards get smaller over time. The charts below depict the pool distribution, the token inflation which it creates, and its proportion to other token allocations.
Fee Structure
The MELD protocol collects fees for various types of utilization. For Wrapped assets, the fee charged is 0.2% for each transactional direction. Fees are also taken on as a 3% margin on loan interest rates. Finally, finalizing swaps charges a 0.2% fee where 0.15% goes to liquidity providers and 0.05% to the protocol. Our protocol highlights at or below fee pricing compared to the competition.
- Wrapped assets - 0.2% fee
- Margin loans - 3% fee
- Swaps - 0.2%
Furthermore, customers can save 25% on transactions by holding a certain amount of MELD tokens. The specific amounts will change relative to time and continuously be adjusted during the early stages of governance. Note that the 0.05% fee is collected and distributes 10% of those earned fees to MELD holders as liquidity pool providers and staking entities.
Fee Distribution
Sale Financials & Token Generation Event
Ticker
MELD
Private sale start date:
June 1st, 2021
Private sale end date:
October 31th, 2021
Private sale Denomination currency:
USD
Accepted currencies:
ADA, USD, EUR, GBP, BTC, ETH
Jurisdiction:
Singapore
Eligibility:
Subject to KYC and AML
Token purchase contract:
SAFT
Private sale stages:
1
Sale type:
Private Sale
Private sale Tokens:
1,200,000,000** MELD
Private sale allocation:
30%
Total Tokens:
4,000,000,000
Token type:
Deflationary (buybacks)
**200m MELD tokens will be withdrawn from the private round if specified criteria is met in the ISPO.
During an initial seed launch period, a portion of the tokens will be distributed among the core contributors, who can delegate voting weight to themselves or the public as they see fit.
Last modified 15d ago