ACycle is about to start additional dividends, let’s understand the logic of the project together
According to the countdown on the official website of acycle.io, the algorithmic stablecoin, as of this article, there are only four hours to start the exciting additional dividends. So how does ACycle perform corresponding inflation and deflation calculations? Through reading its official website and litepaper, then explain the corresponding principles in an easy-to-understand way.
screenshot from acycle.io
According to its litepaper introduction, ACycle has a total of four tokens for the circulation of the stablecoin algorithm system. They are:
ACC (Acycle Cash), a stable currency. Anchor 1ACC = 1 U.S. dollar, inflation above 1.05 U.S. dollar, deflation below 0.95 U.S.
ACF (Acycle Fund), dividend coin. In the case of ACC inflation, pledge ACF and related trading pairs to obtain additional issuance proceeds; when ACC deflation, pledge ACF and related trading pairs to obtain ACB subsidies
ACB (Acycle Bond), to subsidize ACF holders during deflation
ACG (Acycle Governance), used to offset a certain ACC inflation pressure in the ACycle currency system, and used to accelerate mining, and can be used for community voting governance in the later period
After understanding the function of the project token, we can deal with the project logic. We make the following two assumptions: inflation or deflation.
When inflation occurs, ACF holders can obtain ACC inflation rewards. At this time, two choices can be made: replacing ACG to accelerate mining or selling ACC to obtain benefits. However, the selling pressure of ACC will not be very large, because the output of ACF is produced by the ACC/BUSD trading pair, so the additional issuance of ACC will be divided into three directions: destroy to obtain ACG/increase the flow pool to obtain ACF/sell . In this way, as long as the ACC/BUSD pool is larger than the ACC sold volume, and ACG shares the additional issuance pressure of ACC, theoretically, it can keep rising consistently. It is a very scientific economic model.
When deflation occurs, ACF holders can obtain ACB subsidies. At this time, 50% of the additional issuance in the national treasury can start the rescue, and the ACC can be repurchased to stabilize the price above $1. At this time, users who receive ACB subsidies can again Choose to convert to ACC to get profit.
In summary, ACF holders can get a certain amount of profit regardless of whether it rises or falls. ACF plays the most important role in this system.
The screenshot is from ACycle official website ACF mining pool APY
Although DeFi has been in development for more than two years, the development of algorithmic stablecoins has not been more than a year so far. Various algorithmic stablecoins have appeared one after another, which is overwhelming. The subsequent development of ACycle is worthy of attention. *Market risk, the investment need to be cautious