The Role of $XPORT Token

The Portal Network presents a sophisticated tokenomic design that aligns incentives for Validators, Traders, and Token holders. The combination of a decaying emission schedule with a robust burning mechanism creates a unique economic environment that could lead to substantial value accrual for the network.

Basic Overview

Portal Network follows a fixed supply with a decaying emission schedule similar to Bitcoin. The Total supply of $XPORT tokens will be 840M. The initial supply will be 276M. The initial mint at the first epoch will be 6.3% of the initial supply, and then it decays to 97% of the previous epoch every successive epoch, until the full emission target of ~840M has been reached.

Minting Schedule and Incentives

a. Minting Mechanics

Portal's emission mechanics, inspired by Bitcoin's halving model, ensures a controlled supply increase. The initial mint of 6.3% of the initial 276 million tokens at epoch 1, followed by a 3% reduction per epoch, creates a scenario where early validators are incentivized more, which draws liquidity and is expected to create a flywheel effect, while the relatively smooth reduction in minting decay over time allows for a seamless adjustment of demand to meet predicted supply and avoid sudden shocks.

b. Minting $XPORT Tokens

The minting of additional $XPORT tokens leads to an expansion of the total token supply in circulation. This incentivizes and attracts Validators, who secure the network for the block rewards. The minting formula is outlined as follows:

Minting Formula:

  • Minted Tokens = 6.3% as per Protocol Rules with 3% lesser with each subsequent epoch

  • This will ensure the fixed upper limit for $XPORT token

Conditions for Minting:

  • Minting will be triggered by specific events such as network upgrades, rewards distribution at the end of epoch, or liquidity requirements.

  • Validator Set can mint 6.3% of genesis supply * (0.97 ^ epoch number) at the end of epoch

c . Burning $XPORT Tokens

Token burning signifies the permanent elimination of a specific quantity of tokens from circulation, thereby reducing the overall token supply. This is a significant upgrade over many other tokenomics mechanisms that we know of, as of the date of this publication. The combination of a large market for spot trading across chains combined with a fixed supply, and periodic burning of tokens with fees accumulated in other tokens produces interesting properties on how being a Portal Validator is much more attractive, compared to any competing use of other tokens or yield/staking protocols. The burning process for $XPORT tokens is overseen by the Validator set at the conclusion of each epoch.

Burning Formula:

  • Burned Tokens = Half of the fees accumulated from every swap will be used to buy $XPORT token from the open market and burn it, using Portal Swap mechanism.

  • Token burning might also occur in various scenarios like penalty enforcement, or as part of a deflationary policy per validator governance.

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