How the Platform Works
The Cabin in Loot Finance is where TREASURE can be staked to receive inflationary LOOTDOLLAR rewards. The way the algorithm of the protocol works, is that when LOOTDOLLAR trades at an average of over 1.01 CRO during an Epoch (6 hours), the next epoch will emit inflationary rewards of LOOTDOLLAR to all TREASURE stakers in the Cabin.
This is inflation at its simplest, with the idea of increasing supply of LOOTDOLLAR in increments to bring it back down to peg. The opposite is what happens in the bonding part of the algorithm (GOLD Tokens). Essentially when the price is too high, the protocol inflates the supply, and when the price is too low, it contracts the supply. All of this is in a user focused way that requires participation of the user at different stages of the protocol's price movements, and therefore education of users is essential.
- Epoch duration: 6 hours
- Deposits / Withdrawal of TREASURE into/from the CABIN will lock TREASURE for 6 epochs and LOOTDOLLAR rewards for 3 epochs.
- LOOTDOLLAR rewards claim will lock staked TREASURE for 6 epochs and the next LOOTDOLLAR rewards can only be claimed 3 epochs later
- Distribution of LOOTDOLLAR during Expansion80% as Reward for CABIN TREASURE Stakers 18% goes to DAO fund2% goes to DEV fund
- Debt Phase Expansion is when there is outstanding bonds that need LOOTDOLLARS in the treasury in order to be redeemed. The Treasury contract will collect 65% of emissions during this debt phase until it has enough to pay ALL outstanding bondholders. After this number has been reached , whether bonds are redeemed or not, expansion returns to normal rates.
Next Seigniorage indicates a countdown timer to the next epoch. (Each epoch duration lasts for 6 hours)
The Cabin will not emit any LOOTDOLLARS while TWAP is below 1.01. Please read this again!
Debt Phase happens in the epoch after a contraction period, when the TWAP has risen to over 1.01 again and the Cabin starts "printing".
Instead of the usual 80% of LOOTDOLLAR emissions going to the Cabin for staking rewards, 65% is sent to the Treasury contract until there is enough LOOTDOLLARS in Treasury to redeem all outstanding bonds, plus their premiums. This results in a reduced APR for some epochs (although we think it will still be quite an impressive number regardless) and acts as a cooling off period while gearing up for more printing/ expansion!
Expansion Rates (of LOOTDOLLAR inflationary rewards) in the Cabin are currently at 4.5% of supply per epoch until the supply reaches 500,000. The total supply numbers and % changes are as follows:
Less than 500,000 supply- 4.5% per epoch
500,000-1000000- 4% per epoch
1000000-1500000- 3.5% per epoch
1500000-2000000- 3% per epoch
2000000-5000000- 2.5% per epoch
5000000-10000000- 2% per epoch
10000000-20000000- 1.5% per epoch
20000000-50000000- 1% per epoch
50000000 supply and above- 1% per epoch
The Port is the liquidity pools section of the protocol. Here is where you can stake your LOOTDOLLAR-CRO and TREASURE-CRO LPs to earn rewards over the first six months of the protocol. The LOOTDOLLAR-CRO pool will have an allocation of 35,500 TREASURE allocated to it, and the remaining 24000 incentivises the TREASURE-CRO pool over six months. Please see the FAQ for a more in depth explanation of what happens after six months.
The Deck is where users can go to swap their LOOTDOLLARS for GOLD. When LOOTDOLLAR TWAP is below 1, users can burn 1 LOOTDOLLAR for 1 GOLD, always at a 1:1 ratio. Later, when LOOTDOLLAR regains peg, these can be redeemed for a premium paid in LOOTDOLLARS. This is the part of the algorithm alluded to earlier, burning supply when under peg and taking LOOTDOLLARS out of the hands of users, with the incentive and inflation of supply when peg is regained. For specific premium rates please see the BONDS section.