Eneable 0.05% fee buy back burn

As we all know, pangolin has a 0.05% fee integrated in the protocol that can be activated, in this sense, liquidity providers will obtain 0.25% instead of 0.3% of fees when providing liquidity, this 0.05% could be used for what that we deem convincing, in this sense I want to propose a system that I believe will benefit us all.
I think that as a community DEX one of the great objectives we have is to increase volume and TVL through liquidity incentives, with this in mind it is clear the importance of the png token and its economic functioning to encourage both the increase in liquidity and in volume.
Currently we have a liquidity mining system that constantly increases the circulating supply and encourages the entry of liquidity to the DEX, the counter part of this system is that we have a constant selling pressure from those who receive rewards, in this sense if we want to maintain the incentive of rewards for liquidity would be totally logical to have a good price of png, since if the price of png increases this will mean higher rewards and therefore greater incentives, on the contrary if it goes down, the rewards are less and less attractive and the incentive will not be that strong.
Due to this, I propose that the mechanism of 0.05% fees to be activated and use so that the system buys back png and thus creates a buying pressure that counteracts the selling pressure due to the liquidity minig, with this we will be able to subtly stabilize the price generating more incentives of liquidity and hold of the token, also benefiting in general the entire community and png holders, now these tokens can be burned to decrease total supply and increase the scarcity of png in a constant and subtle way that coincides with avalanche and the sistem that they have of buring their fees.
Also this could be used to other purpouse but i leave that to the community, in my opinion a subtile burn is something good for the system.
Let me know what you think. :slightly_smiling_face: :fire:


This is a good idea. But what about using that % to create an insurance funds against IL like Bancor? It would be an awesome feature that reduces risk of LPs and incentivizes LP further

1 Like

Could be an option, nice idea but i would still stick to the burn because i think insurance against IL could be a tottaly new project and also the income from the fees might not be enough to insurance people Liquidity pool tokens.
As a liquidity provier you are getting rewards and IL its just a part of the game imo.

This is really interesting! It’d be a good idea to help create additional buy pressure. I’m curious what the math looks like because it would be reducing fees sent to LP providers. Would the deflationary pressure make up for that?


As Lp provides that 0.05% is 16% less fees but if you think about it, more volume means more fees so it would compensate, also 0.05% is very little and as an option to the burn, this 0.05% could also be distribuhited to people providing other pairs that doesnt get png rewards, that would be a greate incentive for the creation of new pools outside of those that earn png but it would not solve the selling pressure.
Also this change is marginal, as for today 24h fees are 50K, wich is 8.3k daily colected, 1600 png daily at actual price, wich i estimate in one year if volume increases could translate to 1M pangolin burnt or distribuhited between other lp providers outside of png rewarded pools.
Not bad at all imo, could also be divided in a half buy back half to other lp providers.

@dasconnor So, now the mentioned 0,05% fee goes to LP or Treusary?

@myghty Burning PNG is bad idea in my opinion because when you start to burn, you need to burn more in order to keep price level of the coin. It literally defects the stability of the token. It’s also going to lead so much (im)permanent losses on PNG pools also, since the stability of PNG is going to be distrupted if price goes up. So, as LP we are going to loose our PNG’s and dumped by quoted assets. Which will be resulted losses of your PNG rewards and lesser PNG on your wallet.

Best policy of Burning Token is managed by BNB. Since Binance is using BNB as fee incentive and discountive puposes. BNB price is not rised because of burns, it has risen because of community and ecosystem growth. Burns are just an ignition for rooms full of gas. You can check this information from their own article also. In Pangolin we’re paying our fees with AVAX so that it won’t work as much as BNB, even in the case of BNB price action has occoured from burns.