CIP: [to be assigned]
Quorum: 4% of vlCXD / 50% of voting vlCXD must be in favor of the proposal
The current CXD boosting mechanism limits selling pressure by locking CXD, and thus removing their supply from the market. A superior approach would be to create CXD demand by establishing a weekly buyback program from the open market. That is what is being proposed.
Redirect the payouts (via 3CRV and idxCVX) to buyback CXD from the open market. The constant buy pressure is akin to share buybacks - by purchasing those tokens from the open market it ensures constant token demand growing proportionally to the platform, it reduces the openly traded supply of CXD and thus increases the value of CXD tokens. It benefits all CXD token holders proportionally to their holdings, it requires no gas fees to claim, and it is not a taxable event to holders of CXD.
Repurchased tokens will be held within the DAO Protocol entity, available to be used or burned in the future by a vote of the DAO via the proposal mechanism.
The current fee distribution for methodology has a number of serious flaws that will make owning the CXD token less attractive.
- Gas fees. Claiming rewards requires gas fees, often making it impractical to claim rewards.
- Tax inefficient. Claiming rewards is a taxable event.
Because of these flaws, the fees that are being distributed are not even being claimed. As of 6/1/2022 at 10:44 pm, only 2 people have claimed their fees representing 33% of the fees that have been distributed.
The fees distributed for the past two weeks were $6,609 and $1,827. The current 24 hour trading volume of CXD is $196. If those fees had been redirected to CXD buybacks it would move the price upwards. Regular buybacks would continue to support an upwards price and would attract more institutions to CortexDAO and the CXD token.
This approach has been used successfully by Midas.Investments and their MIDAS token. Despite the current bear market, it has recently hit it’s all-time high (on May 23rd).
Short description of what a future voter will be voting for.
Short description of what a future voter will be voting against.
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