Market Cap Buy-back Tiers: The Enhanced BBB Mechanism on XDB CHAIN

Introduction

The XDB CHAIN platform has consistently aimed to enhance the value proposition of the XDB CHAIN ecosystem. Central to this strategy is the buy-back-and-burn (BBB) mechanism, leveraged by BCOs, designed to introduce a deflationary approach that systematically increases the scarcity and value of the XDB CHAIN ecosystem. To accelerate this process, we are implementing Market Cap Buy-back Tiers for Branded Coins (BCOs).

Introducing Market Cap Buy-back Tiers

The Market Cap Buy-back Tiers system is designed to accelerate the burn rate based on the market cap of each BCO. It’s important to clarify that this mechanism doesn’t increase the overall 2.5% allocation of each BCO to BBB but simply moves quicker, accelerating the benefit of the burn process over a shorter period of time. The market cap is calculated as the average quarterly BCO token price over that specific quarter times the total supply. The Buy-back multiplier might change from quarter to quarter depending on the market cap tier of that specific BCO for that quarter. The acceleration is based on the following tiers:

How the Market Cap Buy-back Tiers Work

The tier system enhances the deflationary effect as the BCO’s market cap grows. Here’s how it functions in practice:

1. Initial Allocation: Each BCO allocates up to 2.5% of its total supply for the BBB mechanism.
2. Quarterly Buyback and Burn: This allocation is distributed over 16 quarterly events for each BCO, equating to 0.15625% of its supply per quarter.
3. Accelerated Rates: Depending on the market cap tier of the BCO, the base rate is multiplied to accelerate the burn process:

• Tier 1: $0 — $50M: 1x rate, maintaining the base rate.
• Tier 2: $50M — $100M: 1.25x rate, increasing the supply allocation to 0.1953125% per quarter.
• Tier 3: $100M — $200M: 1.5x rate, increasing the supply allocation to 0.234375% per quarter.
• Tier 4: $200M — $500M: 1.75x rate, increasing the supply allocation to 0.2734375% per quarter.
• Tier 5: >$500M: 2x rate, increasing the supply allocation to 0.3125% per quarter.

Strategic Benefits

1. Enhanced Scarcity: By accelerating the burn rate, this can further reduce the supply of XDB coins over a shorter time period, thereby increasing scarcity.
2. Market Cap Growth: The tiered approach incentivizes higher market caps for BCOs, promoting robust growth within the XDB CHAIN ecosystem.

Understanding the BBB Mechanism

The BBB mechanism operates as follows:

1. Allocation for Buybacks: Each Branded Coin (BCO) launched on the XDB CHAIN platform allocates up to 2.5% of its total supply for the regular buyback and burning of XDB coins.
2. Quarterly Execution: This buyback and burn process is typically organized over 16 quarterly events over a life-cycle of 4 years for each BCO, if no acceleration takes place. First Burn event (Burn #1) is scheduled on July 1st, 2024 2pm UTC
3. Transparency and Auditability: Each BCO burn event is made transparent to the XDB CHAIN community with full disclosure of on-chain data, ensuring complete transparency and auditability for the community.
4. Creating Digital Scarcity: By reducing the overall supply of XDB coins, this mechanism creates digital scarcity, thereby increasing the value proposition of the XDB CHAIN ecosystem.
5. Growth-Driven: The more BCOs launched, the more XDB coins are regularly bought back and permanently removed from circulation.

Future prospects when XDB CHAIN ecosystem supply reaches 10 Billion

As the supply of XDB coins is systematically reduced through the BBB mechanism, there will come a point when the total supply reaches 10 billion coins. At this milestone, any future BCO will continue to pledge up to 2.5% of its supply to the BBB process. However, instead of burning the bought-back XDB coins, these coins will be added to the project’s Treasury. This strategic shift aims to further enhance and support ecosystem and community growth initiatives in perpetuity. By continuously adding value and resources to the Treasury, we ensure sustained development, innovation, and support for the XDB CHAIN community.

Conclusion

The introduction of Market Cap Buy-back Tiers represents a strategic enhancement to the XDB CHAIN’s BBB mechanism. By accelerating the burn rate based on market cap, we aim to amplify the deflationary effect, thereby increasing the value proposition of the XDB CHAIN ecosystem, while keeping at its core the values of fairness and transparency. This innovative approach drives growth and value within the XDB CHAIN ecosystem, benefiting all stakeholders.

Stay tuned for further updates and detailed development plans. Together, we are building a more valuable and robust digital ecosystem on the XDB CHAIN.