Buyback Flow

Value Accumulation and Swaps

The protocol accumulates fees in the form of tokens in its various pool reserves. The tokens are intermittently swapped for MNT to be stored in the protocol’s reserves for distribution as Governance Rewards. Non-stablecoins accumulated in the protocol’s reserves following liquidation events are swapped for stablecoins to avoid price volatility. Assets accumulated from managing token markets and supplying flash loan liquidity are stored in their underlying pools, and if required also swapped for stablecoins.

Governance Reward Distribution

MNT from buybacks is accumulated over a predetermined period and a proportion are distributed as Governance Rewards over the following period. Distribution occurs in a ‘dripping sequence’ instead of a singular large event to prevent user ‘gaming’ behaviours.