Introducing PROPHET: A Fair-Launch & Fluid Yield Generation Token With Dynamic Rewards Rates
What Is PROPHET?
PROPHET is a novel ERC-20 token that improves upon Reflect’s (RFI) innovative yield-generation features.
If you don’t already know, Reflect (RFI) is a recent project by the notorious FLOW Protocol developer known by the pseudonym “Morpheus”.
RFI works by charging a 1% fee per transaction, and redistributing that fee to holders automatically. The amount each holder receives is based on their percentage of holdings. Additionally, certain addresses like the Uniswap liquidity pool are blacklisted, so more rewards go to holders.
Now this is a revolutionary feature because it accomplishes this redistribution to holders without minting, rebasing, or transfers.
Instead, it uses a complex algorithm with dual balance tables to do this fluidly, with no risk of minting vulnerabilities, rebase bugs, or high gas costs.
Additionally, there’s no need to stake any tokens and the yields are completely passive.
How PROPHET Improves Upon RFI’s Fundamental Flaws
Now while the Reflect contract is a groundbreaking protocol, it does have a few flaws. The thesis behind PROPHET is not to simply a RFI clone, but a fork with added improvements on top of the base-layer protocol.
The main flaw we found with RFI is that the1% transaction fee cannot be adjusted. This means as the number of holders grow, each holder receives less and less rewards. If you ended up buying later and only got a small fraction of the supply, then you end up getting a fraction of only 1% of each transaction.
With PROPHET, the transaction fee and rewards are dynamic and adjustable. This means as more and more holders are introduced, the community can vote to increase the fee to sustain the yields. The initial tax starts at 2% and may be increased up to 10% through community proposals.
The first buyer of RFI was able to buy 8% of the total supply in a single transaction for just $0.004 per RFI. Now, it’s not the low price that’s the concern, but the fact that one single person controlled almost one tenth of the circulating supply.
From our analysis of different token launch models in the recent DeFi boom, we concluded that projects with low individual pre-sale contribution caps performed the best in the short and long term. This makes sense because an individual cap implies no early whales who can easily manipulate the price and kill the project early on.
However, we don’t like the idea of pre-sales (nor does the market right now), so we decided to host a 100% direct-to-listing fair launch with a maximum buy/sell limit of 9,500 PROPHET (~1% of supply).
This prevents bots and individuals from buying too much early on. This maximum buy/sell limit will be increased later on to allow for more fluid trading.
More Robust Liquidity
One issue that hindered the initial progress of the RFI project was the developer leaving the liquidity unlocked, and removing 50% of the liquidity after the price went over 20x. This allowed him to instantly profit 160 ETH, which caused outrage and raised suspicion within the community.
While the dev had every right to do so (since he was the one who supplied the initial liquidity and left half), we can understand why the community would be upset by this.
Thus, our plan is to provide 20 ETH of starting liquidity and lock 75% for one year, and the rest (25%) for one week so we can withdraw our initial deposit (20 ETH worth) later when the pool has sufficient liquidity.
In addition, we’ve added an additional rewards program to further incentivize people to add liquidity (details below).
Additional Features of PROPHET
Besides addressing the main issues of the RFI protocol, we also added some additional features to create additional buy pressure on the token.
In addition to a 2% tax per transaction, there’s also a 1% burn that gets sent to the 0x0000… address. This allows the supply to decrease with more trading volume, introducing more scarcity and buying pressure into the ecosystem.
Deflationary systems encourage holding rather than selling since holders gain a larger percentage of marketshare as the supply decreases.
Liquidity Rewards Program
Since the Uniswap pool doesn’t receive transactional tax fees, we realized there’s less of an incentive for individuals to provide liquidity themselves.
That’s why we created a liquidity rewards program where 2.5% of the total PROPHET supply will be airdropped to liquidity providers in the first 10 days. All you need to do is pool PROPHET-ETH and you’ll receive these daily airdrops, on top of regular Uniswap fees.
Team Wallets Are Blacklisted from Receiving Rewards
In addition to the Uniswap pool from being blacklisted from receiving rewards, the marketing and dev wallets are also blacklisted in the PROPHET contract. This ensures more yield for holders, rather than the team.
- Total supply: 1,000,000 PROPHET
- Starting tax rate per transaction (automatically distributed to holders): 2%
- Burn rate per transaction: 1%
- Maximum buy limit per tx: 9,500 PROPHET (1% of supply — to be increased later on)
- Starting liquidity: 20 ETH / 900,000 PROPHET (75% locked for 1 year, 25% locked for 1 week)
- Marketing and Community Rewards: 5% (50,000 PROPHET)
- Liquidity Rewards Fund: 2.5% (25,000 PROPHET)
- Development Fund: 2.5% (25,000 PROPHET — Timelocked for 2 weeks)