SIP005 - The Blackhole

Summary Introduce an automatic burn tax by removing percentages from the RFV and shifting them toward our burn mechanism

Suggestion We want to eliminate 2% of RFV fees and move them to the burn fee. This will help drive the longevity of the protocol. Thus, the new tax structure would be the following (for sells):

5% -> Investment Treasury 5% -> LP Treasury 8% -> RFV Treasury 2% -> burn address (0x000000000000000000000000000000000000dEaD)

Positive: 1.) To reduce the selling pressure of the protocol (sell $SPHERE -> buy $MAI and store in RFV Treasury) 2.) Over time, there will actually be fewer tokens in circulation than there would be without burning, which puts a massive strain on inflation 3.) If for whatever reason a sell shock would occur, a bounce back would be much easier to be achieved, since after the sell event, technically less tokens would be in circulation, thus making an uptrend easier to be achieved

Currently our protocol issues 1.91% daily in tokens, swapping 2% ensures that most of the circulation is slowly phasing out, which would make the protocol much more sustainable. As we see other prominent (auto)staking protocols surpass the 150-day mark, we worry that their token issuance will exceed their liquidity inflow, leading to a massive price drop and subsequent sell event, causing the protocol to cascade in terms of market cap. We want to use possible cascading events to sustain the protocol for the long-term and make sure that even negative events have a positive impact on our long-term holders. Also, the reason why the RFV wallet can hold $MAI tokens is due to selling $SPHERE to the LP, swapping the $WMATIC to $MAI and send it towards the RFV treasury. This sell event would be less taxing since 2% would get burned directly.

Negative: 1.) The RFV will grow 2% less in the beginning due to the transition -> On the plus side, thanks to the burn mechanic, each $SPHERE becomes more valuable as burns occur, so basically the RFV earns more per $SPHERE that is in circulation

The taxes won't be increased. We are just removing percentages from one part of the taxes and move them to a new segment