Decentralized finance is an amazing space. What was once just BTC, has blossomed and inspired an entire generation of new protocols and ecosystems. In turn, bringing the trustless nature of blockchain to the masses and empowering those who were once subject to the will of centralized banking alone. However, in recent times it feels like every new project is a clone, with little to no support/development after launch. This makes it difficult to establish trust for new teams and projects - especially in a decentralized and anonymous space.
To help establish trust with the community the team will be several full audits & private KYC's by industry leading projects and teams. (More on this to come)
Rezerve aims to take giant leaps forward in a space that seems stuck on a treadmill, held back by the volatility of what many perceive to be its main source of value… BTC. Please read further to see how Rezerve aims to decouple its value from the juggernaut tokens & legacy coins to help advance the space in new and innovative ways!
Rezerve's Smart Contracts:
Rezerve has (3) smart contracts and will be a completed project at time of launch. In order to understand this project we need to first look at each contract individually to understand how they work together.
The "Rezerve Contract" is the code behind our ERC20 token. Here are some key details:
- RZRV is partnered with Dai in the liquidity pool.
- These LP tokens are held within the Rezerve contract itself.
- There is a frictionless yield function that is (off) by default - this will be covered in the staking portion of this document.
- The token will have a variable tax function that can be set for buys and sells, independent of each other.
- This tax will ultimately fall at 10% for both buys and sells. It will then remain at that target rate indefinitely.
- The tax is continuously liquidated and sent out to our second smart contract, “the vault”.
- Another function of the Rezerve contract is its ability to swap a percentage of its LP holdings back into both Dai & RZRV tokens. It then automatically sends these holdings to the vault contract. More on this shortly.
The Vault Contract:
This is essentially what enables the project to maintain a rising price floor, it is a very simple concept at its core. This contract secures the Dai sent by the “Rezerve” token contract. This pool/vault of Dai cannot be accessed by anyone that does not hold RZRV tokens. The only way to remove Dai from the vault is to perform a "Vault Swap." When RZRV is sent to the vault contract, it automatically returns the appropriate amount of Dai to the sender. It is important to note - any and all RZRV sent to the vault will remain locked in the contract, rendering them effectively burned. (Circulating supply can only decrease.)
Every RZRV token corresponds to an equal share of the Dai in the vault. The size of this share can never decrease. As more Dai is sent into the contract, each RZRV token's share increases in value. This creates a price floor via the increasing Vault Swap price. The price floor is only ever able to rise due to these protocols.
The equation for the vault swap price is very basic - Total Dai in the contract divided by circulating supply of RZRV.
*This information will also be readily available on the "Vault Interface."
The simplicity of the equation ensures that even as RZRV is swapped into the vault (burned) and Dai is subsequently pulled from the contract - the circulating supply of RZRV tokens still maintain the exact same vault swap value as the tokens swapped before them. To put it plainly, there is no way for a token holder to "dump" on RZRV holders when swapping in the vault. Vault swaps cannot ever impact price floor. Period, full-stop.
For the sake of this example, let’s say there are only (100) RZRV tokens in existence. In this example there will also be 100 Dai in the "vault." This makes the vault price per RZRV token = 1 Dai.
Now let’s say a token holder sends 10 RZRV to the vault, they receive 10 Dai in return. This leaves 90 RZRV in circulation and 90 Dai in the vault. The swap price is still equal to 1 Dai per RZRV token, making this the absolute bottom price for the token. This can only increase over time.
To unpack this a little bit more - in our example let’s imagine 10 more Dai were sent to the vault from transaction fees. This means that there are still 90 RZRV in circulation, and the vault's total balance has returned to 100 Dai.
This makes the new "Vault Swap" price in the 1.1111 Dai. As more RZRV are sent to the vault/burned over time, the rate at which the vault swap price increases is also increased, due to less circulating RZRV maintaining a share of the vault's contents.
The Staking Contract:
Rezerve's staking contract is a new and exciting way to use the frictionless yield characteristic that has been popularized by many onew and successful meme tokens. As mentioned previously, this feature is turned "off" by default. One month post-launch we will roll out staking by incorporating a 2% “reflect” tax.
This tax can only be collected in one way, staking your RZRV. The moment you lock up your tokens for 30 days you are added to the “included in rewards” section of the “Rezerve” contract. Since only those who have locked their tokens in the staking contract will receive this yield, the rewards are exponentially larger than if they were distributed to all token holders.
Again, we will provide an example:
Let’s say 20% of the total supply are locked in the staking contract. That means the entirety of that 2% tax is split exclusively among those staked tokens, making the yield 5x higher because only 1/5th of the supply is receiving the rewards! Exciting, no? Please, feel free to remain staked past the 30 day lock up period as you are included in rewards until you decide to unstake!
We understand these are novel and (admittedly) unusual tokenomics, but we are very confident we have created a revolutionary way to store value outside of the traditionally used AMM liquidity pool, as well as a way to incentivize & reward stakers without diluting the value of RZRV. We encourage you to join our discord or telegram. If you'd like clarity on anything you've read, have questions, ideas, comments, etc. - we welcome you to join the community.
Thank you for taking the time to read about our project, we hope you are as excited about it as we are!
-The Team @ RZRV