$ANS Utility — BUY and BURN event 🔥
⚙️Introducing Our Buy and Burn Mechanism
At ANS, we believe in creating long-term value for our community and token holders. That’s why we’re excited to introduce our Buy and Burn Mechanism. This mechanism is designed to reduce the total supply of ANS tokens over time using the protocol revenue, increasing scarcity and potentially boosting the value of the tokens in circulation.
Why Buy and Burn over locked staking distribution of protocol revenue or something similar?
- A buy and burn mechanism is superior than other solutions for distributing protocol revenues for several reasons. First, holders get intrinsic value without having to do a single thing other than holding the asset. Furthermore, when LP staking arrives, holders won’t be burdened with the decision whether to stake for a protocol revenue share or for LP rewards. So, essentially you can enjoy both token utilities at the same time, enhancing capital efficiency.
How It Works:
1. Buyback: A portion of the revenue generated from ANS registrations and renewals will be used to buy ANS tokens from the open market. 💸
2. Burn: The purchased tokens will be permanently removed from circulation by burning them, ensuring they can never be used again. 🔥
This ongoing process will gradually reduce the total supply of ANS tokens, creating a deflationary effect that rewards long-term holders and strengthens the overall ecosystem.
TWAP Strategy: What is it, and how it works:
- Purpose: TWAP aims to execute a large order gradually over a specified period to minimize the impact on the market price. By spreading the trade out, it helps avoid causing significant price fluctuations.
- Works: Instead of executing a large buy or sell order all at once, TWAP breaks it into smaller trades that are executed at regular intervals over a set period. The average price of these trades is intended to be close to the average market price over that time frame.
- Implementation: For example, if you want to buy 1,000 BTC over the course of 10 hours, a TWAP strategy would involve buying a small amount of BTC at regular intervals (e.g., every 10 minutes). The goal is to buy at a price that reflects the average price during those 10 hours.
- Advantages:
- Reduces Market Impact: By spreading out the trades, TWAP reduces the likelihood of moving the market price significantly.
- Avoids Slippage: Slippage occurs when the execution price deviates from the expected price. TWAP helps manage this by averaging out the execution prices over time.
5. Use Cases: TWAP is often used for large institutional trades, algorithmic trading, and by traders who want to execute orders in a way that’s less disruptive to the market.
The First Burn Event 🔥
Today (23rd September) marks a significant milestone in the ANS journey as we conduct our very first token burn. 100% of the ANS protocol revenue so far was used to acquire (buy) using the TWAP strategy over 2 days and burn 2 million $ANS tokens (accounting for 1% of the total circulation). These tokens are permanently removed from the circulating supply.
Exactly 1741191.643 $ANS were acquired on Ayin from 8 tranches of 200 $ALPH, the remaining were provided from the team tokens.
This event demonstrates our commitment to the community and our vision for a sustainable and thriving ecosystem. Stay tuned for more updates as we continue to innovate and build a decentralized future with ANS. 🖇
Keep an eye on our channels for more updates and the latest developments in the ANS world. 👁️
Links:
