Phoenix Network launches a new Token economic model, log in to Blast L2

Recently, Phoenix Network announced its official log in to Blast L2 and launched a brand new Token and economic model, injecting new vitality into the decentralized derivatives track. Phoenix Network conducted its IDO on May 13, reaching the hard cap in just 15 days, raising 625 ETH, with a subscription amount exceeding 2.4 million USD. This article will detail the dual Token economic model of Phoenix Network on Blast L2, including the governance Token $PEX and the contribution value Token $WIN.

Overview of Phoenix Network

Phoenix Network is a decentralized derivatives trading platform based on Blast L2, aiming to provide an efficient, secure, and transparent perpetual trading environment to attract users to participate in the decentralized financial market and provide incentives. Its dual Token economic model is an important component of the project, determining token distribution, incentive mechanisms, and long-term development.

Governance Token PEX

PEX is the protocol governance Token of the Phoenix Network, with a maximum supply of 10 million coins. Its main functions include platform governance voting rights and serving as the primary value storage point for the revenue of protocol derivative exchanges.

The issuance of PEX tokens

The issuance of PEX is closely related to the development of the Phoenix Network. In the early stage of the project, the genesis minting was conducted through an IDO, with a total of 333,333 PEX minted. Among them, 33,333 were allocated as minting tax, and 300,000 were used for the IDO and to add initial liquidity. The IDO price was 0.0025ETH, and the initial listing price was 0.0031ETH.

The subsequent issuance of PEX can only be minted through bond sales. The treasury holds all the liquidity of the PEX-ETH trading pool. The actual supply of PEX is influenced by factors such as the value of treasury assets, PEX price, and the profitability of positions in derivatives exchanges, and it is expected to enter a deflationary phase in the later period.

circulation of PEX

PEX holders can earn rewards through staking, with compounding increases in the form of sPEX. After unstaking, the compounded rewards are released in equal amounts over 180 days per block and can be accelerated by burning WIN. Users can also add PEX-ETH LP liquidity to purchase LP bonds and obtain PEX minted by the treasury.

PEX's destruction and rights

PEX is closely related to the derivatives exchange PbTrade. The treasury acts as the short-term counterparty for all trades on PbTrade, while PEX serves as the long-term counterparty. When traders incur losses, 35% of the profits from the treasury's positions are deposited into the national treasury as reserve funds for minting PEX, and 55% is used for repurchasing and destroying PEX. In extreme cases, when traders' profits lead to insufficient ETH collateral rates, the national treasury contract will activate the reserve funds to mint PEX to fill the gap.

25% of the PbTrade transaction fees will be returned to PEX stakers, enhancing the value capture capability of PEX.

Contribution Value Token WIN

WIN is the protocol contribution value Token of the Phoenix Network, with a theoretical maximum supply of 10 billion coins. Its main purpose is to reward those who contribute to the growth of the protocol's user base, as well as to accelerate the release of WIN staking yield through a burning mechanism.

WIN's minting increase

WIN is minted by users who stake PEX, consuming USDB. The minted WIN is rewarded to those who contribute to the growth of the protocol's users. PEX stakers must additionally spend 20% of the staked PEX value (USDB) to mint WIN Token, in order to earn a high compound interest of 0.2% every 8 hours.

WIN Redemption and Burn

WIN holders can accelerate the release of PEX staking rewards by burning WIN. Users can also redeem WIN for USDB from the USDB vault at the real-time price, incurring a 15% redemption tax. The minting, burning, and redemption of WIN will all lead to an increase in its price.

Dual-Currency Economic Model

PEX and WIN play different roles in the economic model of the Phoenix Network, interdependent and promoting each other, jointly driving the development of the platform:

1. Inject funds and liquidity into the protocol
2. Maintain platform stability and balance
3. Improve transparency and fairness

The dual-token economic model of the Phoenix Network is at the core of its decentralized derivatives trading platform. The interaction between PEX and WIN will drive the platform's development, achieve economic balance, enhance transparency and fairness, and protect the interests and rights of users.