⭕THE BENEFICIAL LOOP
Introduction:
$PANTHEON has designed a self-sustaining loop that not only amplifies its value but also continually boosts its attractiveness to participants. This documentation simplifies how this beneficial loop works.
1. Launch & Initial Attraction:
Kickstart: The launch introduces the $PANTHEON token and its enticing features.
The Allure of High APR: An impressive Annual Percentage Rate (APR) is presented, acting as the initial magnet for liquidity providers.
2. Attraction of High APR:
Liquidity Multiplies: The tempting APR lures more investors to the liquidity pool.
Key Activity: To join this pool, participants buy or mint $PANTHEON to pair it with assets like $USDC.
3. Ramifications of Increased Liquidity:
Boost in LP Price: With a growing number of participants and deepening liquidity, the Liquidity Pool (LP) token price starts its ascent.
4. Emergence of Arbitrage Opportunities:
Spotting the Discrepancy: A rising LP price manifests a gap between the contract and the LP rates.
Capitalizing on the Gap: Astute traders grab this window of opportunity. They mint $PANTHEON from the contract for less and offload it in the higher-priced liquidity pool.
Dual Rewards: Minting boosts the token’s contract price and simultaneously amplifies the APR.
5. The Natural Profit Extraction:
The Dynamic: After enjoying appreciable gains, some holders decide to liquidate, selling their assets.
LP’s Reaction: This sell-off nudges the LP price downwards.
6. Round Two of Arbitrage:
Spotting a New Gap: The lowered LP price vis-à-vis the contract rate opens a fresh arbitrage door.
Acting Again: Traders now purchase from the deflated liquidity pool and proceed to burn in the contract in order to redeem the corrisponding amount of ETH, reaping the price differential.
Double Boost: Each redeem action elevates both the contract's price and the overall APR.
Closing Thoughts:
$PANTHEON’s mechanism isn't just another DeFi strategy; it’s a continuous loop of growth and allure. The model ingeniously leverages market behaviors, ensuring that every action, whether minting or redeeming, doesn't just benefit the actor but the entire ecosystem. Engage with $PANTHEON and ride this ever-ascending loop!
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