Fee Buyback & Burn Mechanism
The Fee Buyback and Burn Mechanism is a key pillar of the OrangeBit tokenomics framework, designed to maintain a sustainable value loop between platform activity, $ORANGE demand, and long-term community growth.
Through a combination of fee redistribution, token buyback, and controlled deflation, OrangeBit ensures that ecosystem value continuously cycles back to active participants and long-term holders.
1. Mechanism Overview
A fixed percentage of all platform-generated revenue — including trading fees, funding fees, and liquidation penalties — is periodically allocated to a Buyback Pool.
This pool is used to repurchase $ORANGE tokens from the open market or liquidity reserves.
Repurchased tokens are then distributed according to the following structure:
Staking Reward Pool
40%
Reinforce staking yield sustainability
Burn Reserve
40%
Permanently remove tokens from circulation
Ecosystem Growth Fund
20%
Support liquidity incentives, marketing, and partnerships
This model creates a continuous feedback loop where trading activity directly enhances the intrinsic value of $ORANGE.
2. Burn Policy
To maintain a deflationary supply trajectory, 40% of the repurchased tokens will be sent to a verifiable burn address.
All burn transactions will be publicly viewable on-chain, ensuring transparency and verifiability by the community.
🔥 Objective: Gradually reduce the total supply of $ORANGE, increasing scarcity and reinforcing long-term holder value.
The burn frequency will typically follow a monthly or quarterly cycle, depending on trading volume and ecosystem performance.
3. Fee Allocation Structure
Spot Trading Fees
25%
Collected from all maker/taker orders
Perpetual Trading Fees
20%
Includes funding fees
Liquidation Penalties
30%
Applied to penalty-based recoveries
Withdrawal Fees
10%
Minor contribution to pool
Staking Early Unstake Penalties
15%
Redirected entirely to buyback reserve
This dynamic fee recycling model ensures that every part of the trading ecosystem contributes to token health and sustainability.
4. Governance Control
The allocation percentages, burn frequency, and distribution ratios are not fixed permanently.
They can be modified through on-chain governance via community proposals and votes, empowering $ORANGE holders to actively shape the token economy.
Governance participants can:
Propose or approve changes to buyback ratios;
Adjust the proportion between burn and redistribution;
Allocate specific funds toward community campaigns or liquidity expansion.
This ensures the mechanism remains adaptive and community-driven over time.
5. Economic Impact
The Buyback & Burn Mechanism has a multifaceted impact on the $ORANGE economy:
Creates Real Demand: Trading volume and platform activity directly increase token demand via buybacks.
Reduces Supply: Controlled burns gradually lower total token supply, increasing scarcity.
Supports Staking Rewards: Buyback-funded rewards stabilize APY without excessive token emissions.
Strengthens Market Confidence: Transparent, verifiable deflationary mechanics enhance trust and attract long-term investors.
By tying $ORANGE directly to the platform’s success, OrangeBit ensures that token value grows organically with ecosystem adoption.
6. Transparency & Reporting
All buyback and burn events will be recorded in a public dashboard with full transaction hashes, enabling users to verify every event independently.
The dashboard will display:
Total fees collected;
Amount of $ORANGE repurchased;
Tokens burned (cumulative and per cycle);
Current circulating vs. total supply metrics.
This transparency reinforces OrangeBit’s commitment to open and accountable token management.
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