Treasury as Collateral for GTON
The mission of Graviton is to synergistically join together various projects, DeFi services and assets from popular blockchain ecosystems through a single integrated solution with the simplest possible user experience. We believe that assets from a single blockchain network should be available and liquid in as many other networks as possible and their most prominent DeFi services.
For the product solutions that the team is working on to have traction, such as Mega-Bridge (an aggregator of bridges in a single simple UI) and Mirror Accounts (one private key/wallet for all integrated networks, without the need to switch between them), it is necessary to have additional incentivization that would encourage the usage of bridges and accounts. The most reliable and proven way to achieve this seems to be increasing the liquidity of wrapped assets in the destination chain through rewarding Liquidity Provision (LP). Projects such as PancakeSwap, Curve, SushiSwap have demonstrated the efficiency of this method, and thanks to such an incentive model, many cross-chain assets have been able to receive a boost in liquidity from users.
However, the tokenomics model in which the token is distributed only as a reward can be unstable, as liquidity providers tend to instantly sell the farmed asset, which in turn hinders the price growth and makes further liquidity provision less profitable. In Graviton, this problem is solved in several ways: short (1–2 weeks) and periodic (every 2 months) liquidity stimulation programs — Graviton Catalyst and Graviton Boost — as well as token swaps with other DeFi teams, contests, and airdrops.
The success and attractiveness of GTON will be reliant on its initial liquidity, which will be formed from EB treasury funds. Stablecoins that are currently being locked in the treasury can be considered as collateral (backing) for GTON, which can be periodically released to redeem the token and add liquidity into AMM services (e.g. Uniswap).
The token unlocking schedule for EB is nonlinear, and releasing liquidity from the treasury to put it in AMMs can go according to the same schedule. If we suppose that the token holders in each new unlock installment sell a half of their tokens on average, then for each such sale, GTON will also be automatically redeemed from a half of the released funds to form GTON liquidity pools on AMMs. For example, let us suppose that the Treasury collected $2.1 million for 2.1 token allocation (10% of the max supply), which sets the GTON price after the end of EB to $1.
Under these assumptions, the early backers will be able to sell half of their unlocked allocation without influencing the price, and this will grow the total liquidity in the pool every day.
If the users will sell less than a half of their unlocked token amount, the price will move higher above the discovered price from the EB stage; and vice versa.
The release of stablecoins from the treasury, buying back GTON via AMMs, and depositing of the received LP tokens to refill the treasury will be carried out automatically by smart contracts on the Ethereum network.
This mechanism will bring initial liquidity to GTON from the beginning, and its growth will follow the unlock schedule of the token. In case of additional demand for GTON, the price of the token may increase, but the design will remain stable nonetheless.