Protocol Mechanics

Q: Does having $DXBL split between multiple chains result in fragmented liquidity? If so, does that reduce overall fees for the holder by not exposing them to trading on all networks?

A: In short, yes. The value of the chain's $DXBL token is rooted in the Community Vault pools split by each network. Each $DXBL for each network will have a different price because each chain will have a different minting rate difficulty based on the volume and speculation per each chain. The goal of $DXBL is to reflect volumes on that respective network.

A positive aspect of this design is that it removes dilution from chains with lower trading volume while keeping the incentives in place to attract more volume back to those chains. One might assume fragmented liquidity would make value accrual to the Community Vault more challenging, an assumption originating from the belief that a lack of concentrated volumes will not drive NAV up sufficiently per network. However, by design, this methodology creates more opportunity and incentive on lower volume chains while also maintaining the upside on higher volume chains.

Q: What happens when trade volume goes down?

A: When protocol volume decreases relative to prior volume windows, the difficulty of Minting Rate will decrease proportionately. This will result in an increase in the supply rate, leading to dilution of the Net Asset Value (NAV) and a decrease in the value of each outstanding token. Under these circumstances, the community is incentivized to engage in trading at the more favorable Minting Rate, thereby restoring volume to previous levels.

Q: What will happen if the volume remains unchanged? Will this result in the growth of NAV?

A: In the event that volumes are consistent, the NAV may remain unchanged or experience a slight increase due to token burns, resulting in less dilution.

Q: What happens when the Minting Rate goes down?

A: When Minting Rate is lower than previous Volume windows, traders are able to mint more $DXBL for less volume, which give them access to more of the Community Vault.

Q: Can the ability to burn $DXBL at the current NAV be considered a fee sharing mechanism?

A: The $DXBL burning process is better understood as a redemption program that incorporates a supply scarcity mechanism.

Q: How does Proof of Trade simplify supply and demand economics?

A: Proof of Trade's minting mechanism guides token prices based on platform volume rather than the Total Value Locked or the available liquidity in fragmented public pools. Additionally, the Dexible Community Vault provides liquidity and price discovery through its burning mechanism.

Q: What happens when a trader has a referral code?

A: Discounts from holding $DXBL or a referral code are applied on each child transaction of an order, up tot he maximum discount of 50% or a minimum of 4bps.

Q: What happens if there's no more of a particular token in the Community Vault to redeem?

A: If a particular Community Vault pool is empty, users may not redeem their token from that pool until there is sufficient supply. By design, other pools will have sufficient supply for burning.

Q: What is the benefit for the team in relation to Proof of Trade and $DXBL?

A: The team does not receive any allocations or airdrops of $DXBL. The only benefit they receive is from utilizing the protocol themselves, just like everyone else.

Q: Does Proof of Trade offer a mechanism to lock in liquidity by pledging assets? Are there any benefits to doing so?

A: Currently, Proof of Trade does not provide a pledging mechanism for locking in liquidity. $DXBL is designed to be a pure utility token that provides discounts and value to the community.