Exactly. That is the point of it. Only difference from many other chains who focus on reducing supply en masse is that they have a flat fixed tax vs this is incremental from 0-100%
(10% on buy and 15-20% on selling isn’t new and has not stopped listings in top 10 exchanges on meme blockchains that rival TC in mcap and with userbase in millions vs our chain).
I can not see where taxes are something that exchanges would not accept.
It’s a free market and thus we are free to set conditions on the assets of our chain.
That’s just a convienent bit of nonsense, isn’t it.
Speculative buy pressure does not happen without a catalyst - a working, actionable 50x is the catalyst.
I guess you skimmed the proposal for keywords and didn’t actually…read it?
Go back and read about Protocol Buybacks.
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why ?
Doesn’t $USTC have a wormhole version too. ?
if it’s a free market then $LUNC WORMHOLE MIR USTC are sweet.
$wLUNA for me though.
however, thanks for the information, Tony, i will be going through all this over the next week.
Free market concept: Government will not burden or hinder a private trade between individuals who agree on their trade.
A beatiful ideal, yet in the real world it does not exist exactly
If you use a middleman or a platform to conduct the trade then you are not conducting a private sale per se, but that’s nitpicking.
Since you are accepting a third party in your trade and thus accepting the third parties conditions in it.
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Flexible rate does not mean you are not cutting into sellers.
Lets not bundle things to talk in one piece. Yes 10% on buy and 15-20% on selling are in some exchanges, those are DEXs. Try to name ONE major CEX within top 10 that have these types of meme coin listed and what that meme coin is? I would like to learn which CEX accepted these.
Also, are we now talking about to turn USTC into a meme coin?
You are free to set the conditions, but you are also competing with other chains out there. When you set these harsh conditions, from a new investor point of view, why would he choose USTC over others when they have to worry about liquidity / getting stuck without sufficient buyers when they want to get out and get heavily taxed?
The proposal did talk about building collateral, but how? By cutting traders that not follow the peg by 66.6% of their money taking as protocol’s profit? This is not a sustainable way nor by any means provided USTC investors market confidence.
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I think his purpose is good.But crypto is finance + technology,only technology is not enough,we still need a financial structure design of this plan.Especially this part,how to create demand of Ustc healthy,such as some sustainable usecases.
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DYOR about the multiple tokens and their specific tax rates (4chaners call naming it schilling if any token other than TERRA asset is presented), but I can give you a few:
MEXC, Gate.IO, Huobi and oh, this thing called Binance.
No, with this proposal (that seems you didn’t still read) there’s two options:
IF top 3 CEX’s agree to the conditons - it goes live. Any CEX or DEX that refuses - well - though, but they will be blacklisted.
I’m surprised you know so little of Terra chain as there was Tobin tax present in the “pre-crash” days.
I’m also baffled how you do not grasp the concept of a Stable coin. It’s in the name. The value is set. If you sell below the set value - you are undercutting the market. Diluting for the rest of them, but whatever. Your money.
Free market does not constitute that you are able to buy or sell everything at the value YOU choose… Free market constitutes that government does not impose restrictions nor hindrances upon the trade between two private citizens.
Since you trade on a DEX or a CEX - it’s not by default a private trade, since you are introducing a third party into it, but besides the nitpicking on the colloquial term used - we can include the CEX or DEX as a party in that trade and if 2 out of 3 agree that this trade shall be executed with a tax if you want to undercut the market then you shall pay a tax and you agree to it - then what is the exact complaint you have?
*No divergence tax between wallets. You can conduct your private free trades at whatever prices you set.
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Stable coin = pegged to 1.
USTC not stable coin since May 22’. Same meme, like LUNC now.
Can you name any token listed on
CEXs that you mentioned that supported 10% on buy and 15-20% on selling by these CEXs? Oh… I found NONE, maybe I missed it? I thought they supported the 10% on buy and 15-20% on selling tax for some token they listed.
You know LUNC is permissionless? Now you are talking about blacklisting top exchanges? Banning the community from using them? Who are you?
How is this extremely high percentage of fees ( 66.6% ) compared to Tobin tax?
That’s not undercut the market, people owns those USTC and they have the right to sell at their desired price, if they don’t get what they want, simply no deals made, so you are saying this proposal won’t cause liquidity issue and reduce volumes earlier? The volume drops and how effective can this proposal be without volume?
A True Free market should not include much government intervene, prices are determined by supply and demand expressed by sellers and buyers instead. One of the point for crypto is to get away from government control, and now we are back to square one? From a New investor standpoint, rather enter a “REAL permissionless” blockchain other than LUNC & USTC.
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Like I said, mate. DYOR. Elon could help you, if you are unable to look into the most trending tokens and some not so trending ones. On all the chains.
Taxes, or as you impose, high taxes - are nothing new.
If you look at the topic you are in - It tells you the stable in question. LUNC is not in question here, but if it comes down to it… Unless you have a better solution, that you haven’t mentioned and only want solutions from others while not providing any viable or feasible approach yourself?
They have the right to sell at any price. Nobody is questioning it. Yet the chain has the right to tax them on it. That’s the beauty of your so called free market. The conditions that are set by private citizens. IF you sell on a DEX or a CEX - they can and usually do have their own fees on top of any tax, if applicable.
You have the right to sell at a lower price, the chain has the right to tax you on it as that is the condition that is agreed upon and the buyer has the right to buy at the price you propose at.
The amount you get from the trade - if you trade it - assumes you agreed to the terms.
You aren’t entitled to dictate the other parties terms - the free market you talk about applies to government.
And sadly - there is no true free market and this is not a true free market and neither is any sale on it.
You are taxed community tax (txn fees), you are taxed burn tax (0.2).
If you want a truly free market - I suggest you do better DYOR than you did finding popular tokens and reading through their WP.
Or hell, if you know of any true free market, besides government imposed restriction, taxes or laws - do let me know. None to be found in the world I preside in.
This made me chuckle. Haven’t you done any research into this chain? Pre-crash it had also those awful taxes and fees that restricted your freedom.
Why do you expect it to be different now?
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Tokens are trending that when peoples buying it. Demand.
For ustc now this is staking, dapps restoring and no any distribution.
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I think the one thing everyone is forgetting is the simplicity of this proposal.
A good 40-50% of ppl coming into crypto will prob not have a full understanding of taxes, fees etc…. They won’t have a clue of terminologies.
They have an idea of putting x amount into a fund and getting the same out or a bit more.
Just read all the forums and you’ll be surprised how many ppl are clueless but interested.
If we over complicate these issues then there’s nothing attracting ppl to us rather than other currencies. I know that’s their choice, but I like to think we make so easy for newbies, and not tax them too much or charge them too much!
These fees are obviously an issue, so need more investigations, and discussions.
I for one like the idea and with a few tweaks I really think we have something!…. Let’s get together and build on this idea
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One of the most plausible and doable parts of this proposal is this staking module.
If you can build this first, you can charge people at 5% when they are unstaking. Instead of a 1 month, etc etc scheme I would advise you to have a 1 day, 7 day, 30 days, 60 days, 90 days, etc. so that more people can unstake (you are collecting 5% fees on “unstaking” so you need more people to unstake as many as stake). You can also do the opposite and take 5% when staking. This will directly fill the Oracle Pool for USTC rewards.
The following are the to-do’s which are needed to be achieved if this module is to be made:
- The Oracle Pool for USTC will have to be made first. Which means we need a store of USTC first. This should be large enough to distribute rewards to initial stakers. This needs to be calculated how many people can participate in the initial offering. This will depend upon how much liquidity of USTC we can get. There is some USTC in the Community Pool. Maybe that can be used
- This staking feature then needs to be integrated by all the wallets which are operating separately. We can definitely do this on a web interface also for the time being but it will have to be made by someone if we are to enable users to stake their USTC. So you need to coordinate with not only L1 developers but L2 developers also
- The Divergence Tax can be integrated at the point of staking and/or unstaking, rather than buying. You do not tax anyone when buying or selling. Tax them only while staking and/or unstaking
- Distribute rewards not as USTC but as the other useless coins we already have in the community pool. That will not total much but you do not need to give everyone USTC initially. You can give them LUNC also as rewards from the existing Oracle Pool. Yes, this will deplete the pool faster than calculated before this, but this is probably a calculated bet since you will be making money back in divergence tax and that will be going back into the pool again so the investment may mathematically reap profits (though this is something I need to calculate separately). In a way, releasing more LUNC might bring the price down slightly but that hit we need to take for USTC. The hope is that LUNC will immediately recover cause of the FOMO
- Since the objective is to repeg this, USTC will have to be burnt, so you will need to add a burn tax on either staking or unstaking depending upon whether you put the divergence tax on unstaking or staking respectively. This is the backup cause according to my calculations there will be a point of time when the price will stabilize below $1 if we do not actually burn some USTC. Also, if we do not do this, whales could manipulate the prices by staking and unstaking as required. So in a way, the burn tax is the control on the divergence tax
Just remember one thing - the more the value of USTC increases, the more (in dollar value) you are paying back to the staker when he is getting rewards.
This hypothetical dollar value can actually be used to give back to the users lesser than what you would have given back since you can use a swap pool at this point of time to convert to LUNC and then pay the user. You see, the amount of LUNC you need to give the user as rewards will remain constant, since a fixed amount has been staked with us. So a fixed amount of LUNC will be given to the user as rewards. But the value of USTC has increased during this time. So you are essentially rewarding 10 people at the price of 6 if you convert it to LUNC before giving to them.
These are my thoughts on this subject.
That is correct and I re-read the proposal.
I have to apologise to @RedlineDrifter for blasting at this proposal earlier. That was my mistake and I was too impulsive when I wrote those comments.
I feel this comment should be constructive enough as a feedback for this proposal.
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While I agree that the proposed method might be the right fit for re-pegging USTC, I am not sure about the situation in the event of reaching the peg and gaining stability, especially in the scenario of a price being above Peg of $1USD.
Unless I have not overseen it there is currently no method foreseen to mint new USTC. In a scenario of having a constantly high demand on USTC, it is not necessarily bad to go into the direction of quantitative easing and extend the supply of USTC as it would allow USTC to grow according to the demand. Have you thought about that?
It might sound ridiculous but as long we have stable market conditions without disruptive events also the former algorithm was able maintain a peg against the USD, while being able to expand and shrink the supply according to the demand. I’m not requesting to re-activate the old method, but expanding and shrinking the overall supply becomes vital to a coin, that shall represent a digital twin of classical fiat money.
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I think a lot of the responses are forgetting to consider that there is no requirement to sell into a below peg market, thus paying a larger tax.
An investor will have the option to hold (thus helping peg stability) and sell later with no tax for the full peg amount.
This tax disincentives selling into a falling market further stressing the peg by, intelligently in my opinion, using the exit fee itself to defend the peg as well as providing a financial incentive to hold through the storm.
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I am a little bit concerned about the divergence tax being applied at the point of selling or buying.
It’s too high to be of value in investing. I mean, safer than this is to buy Fixed Deposits from a bank cause if by chance the price of USTC falls instead of rising, then the investor has to unstake and sell at a complete loss.
Being a trader, I can tell you that we choose coins to invest in depending upon the exit strategy. But in this case, there is no exit strategy. Either you hold till 1 dollar, or you are in losses.
Not a lot of people might take that bet.
Stop slapping the “DYOR” already if you know any one of the Token is listed on the largest CEX
do us a favor, you know so many of them listed on Binance that supported 10% on buy and 15-20% on selling by Binance, just list ONE for us as an example to look for, shouldn’t be a hard task? Stop talking with AIR, give us some examples.
If you cannot list even ONE, don’t talk like these high taxes are normal and supported by CEXs, admit you are wrong and we won’t continue to ask this question.
At the end of the day, CEXs is making profit by trading volume, and extremely high taxes will nuke the volume and hurt their business. Divergence Protocol is just another form of tax.
I think we all know how the 1.2% burn tax gets it support from CEXs, surely it went well. And oh… this is only talking about 1.2%, what this protocol suggesting? Up to 100%? Surely CEXs will support this when they won’t even implement the 1.2% tax off-chain.
I got to say, I did provide solution and other approach, and YOU did replied to them 
And also you skimmed that proposal xD
Did you read? You are comparing taxes extremely high ( 66.6%, up to 100% ) to a Tobin tax or burn tax ( 0.2% ), is this even a fair comparison? Yes, they are both taxes / fees, but no, not both of them are fair. You charge Tobin tax / transaction fees as a fair amount when they use the blockchain, while you are calling this high % of tax “fair”.
Yea restricted their freedom but people still able rush to get out from USTC and make it crash and crumble ( by the flawed mechanism ). But at least people can take their money back when they want to. This protocol is taking the freedom away from people to lock them in USTC, do not let them to get in and out whenever they want to and when there is much more seller than buyer? And you are saying this is a restriction making USTC better overall?
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I guess I see it in 2 different phases.
The first phase, it’s a speculative asset. Maybe it works maybe it doesn’t. It has a large upside but the price of admission is playing by the rules which as you’ve said may be not attractive to traders. This phase there may be large taxes due to depeg events. But does a potentially huge upside balance the risk of eating a sales tax? Up to the trader.
Once we’ve been through the arduous journey to a peg we reach the second phase, as a stable coin. Maybe we’ve tweaked some values from things we’ve learned along the way, hopefully our backing assets are sorted out and things look rosy. At this point we need to transform from speculative to stable. We should always be basically a dollar. (I think). Basically swap in for a dollar and swap out for a dollar. 99.9% of the time. If we start to depeg you can either loose it all in capital value during death spiral 2 or take a hit in taxes helping fight back
TL;DR;
Stairstepping to peg is a gamble with a price to play.
Once we reach peg taxes should be minimal to non existent in non exceptional circumstances.
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You are in crypto. No asset, stable or otherwise is “safe”.
And banks and fixed deposits are also not “safe” if you look at the recent collapses in forex and banking.
Absolutely - not many will take the risk. Same way that ~95% of population hasn’t taken any risk towards crypto.
If you want safe - you buy gold.
And if the USTC has a depeg event (like we saw with USDC and USDT recently) - you have two options. Wether the storm or bail out. There’s always risks. None of this is guaranteed and no crypto or fiat asset gives guarantees.
Look at trending tokens. Look at their taxes and fees. Elon and his dog love is a very specific clue where to start digging to learn about the world of crypto currencies and how they aren’t free of fees/taxes and gas fees. (Tho, I do misappropriate tax=fee)
Heck, even BTC has fees on trades.
Lykke wallet claims to be almost feeless, but that’s a point of contention.
Point being that your misnotion of crypto being free is unfounded entirely. Ever heard of Ethereum? You know how their gas fees are, right…
Like I said many times - you have a richest man by gross net worth schilling the whole dog kennel and you cba to look into the specific tokens. That’s on you. Also NFA.
You seem to be misunderstanding the proposal. Tax is incremental as well as the peg is going up in increments.
Furrher away from peg you are - more you get taxed. It doesn’t start at 66.6%, but it does stop at 100% if you are selling 50% away from the peg on a DEX/CEX
Tobin tax applied in the same manner and old Terra was supposed to apply a 100% tax on 60% away from peg. It didnt work. Code was bungled. Oops.
That makes no sense. USTC crashed below a cent. How did folks “take their money back when they wanted to”. Theres some 40 billion dollars lost
How does one acquire it back freely?
If a dollar dips in value, you lose purchasing power. Fed uses tax hikes to stabilize it. Not a new concept.
We use divergence tax to stabilize it.
I get it - you want control, but you can’t find controm and guarantees in any monetary system to date.
Free market notion is much a dream that true decentralization. No matter how much you pound your chest and claim that it’s your token and you should be able to do what you want with it.
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I agree with blocking USTC within a protocol and releasing them over time. This can help peg and also reduce the pressure of massive sell-offs.
I am still in favor of the freedom of users, their money and their privacy, but what is necessary must be done to restore the blockchain