🎆$RATIO Token
$RATIO is the SPL governance token associated to the protocol.
Good to know: $RATIO holders own and control a number of aspects of the Ratio Protocol and are incentivized to participate in governance decision-making through financial reward mechanisms. As the Ratio ecosystem grows, the demand for the token is designed to grow and the supply of the token is designed to tighten.
Definition
$RATIO is an SPL governance coin that allows holders to control the resources of the Ratio Protocol. $RATIO holders own and control a number of aspects of the Ratio Protocol and will also be rewarded financially for participating in governance (learn more in the Governance section). As the protocol becomes fully decentralized, $RATIO holders will increasingly become the owners of Ratio Finance.
$RATIO Tokenomics
Over the long-run, $RATIO token economics are guided by a few key forces. These forces influence the supply and demand curve for $RATIO. We at Ratio Finance have specifically designed these forces in an effort to constrict supply and augment demand for the $RATIO token.
Forces Influencing Demand
The demand for $RATIO tokens on the open market will come from two sources.
Token buybacks. The Ratio Protocol will buy tokens off the open market using the cash flow it generates from its business. This will create a constant buy pressure in the open market.
Demand for services. The Ratio Protocol will provision services to those participating in governance, such that users must hold a certain amount of $RATIO in order to access them. The first service Ratio will offer users is its Ratio Risk Ratings (RRR), which is an API-based service for quantifying the risk of select crypto-assets (more on this to come). The target buyer of this service are other DeFi protocols, who will pay to display RRRs on their platform.
Forces Influencing Supply
Outside of the normal release of tokens into Ratio's treasury and distributions to its team and investors, there are two sources of supply of $RATIO tokens on the open market.
Continuous incentives. The Ratio Protocol will continuously use a portion of its strategic reserve of $RATIO tokens to incentivize user behavior profitable to the Ratio ecosystem. This serves the purpose of continuously growing the Ratio ecosystem as well as redistributing $RATIO tokens to its real users.
Exits from governance. $RATIO supply will come from those seeking to exit the governance system, and sell their tokens in the process. To combat this, Ratio aims to supply its governors high-value services.
As you can tell, these forces are designed to be largely balanced at first. However, as the Ratio ecosystem grows, the demand for the token is designed to grow and the supply of the token is designed to tighten.
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