DGTX deflationary tokenomics
The Digitex (DGTX) token's deflationary tokenomics are powered by the DGTX buy back and burn mechanism which uses a portion of the fees charged on winnings to buy back DGTX tokens from the open market and burn them.
0.5% of every ETH, USDC, USDT or ARB winning bet will be automatically set aside for the purpose of buying back DGTX tokens from Uniswap and then burning them. However, the DGTX token will exist on 3 different chains: Ethereum, Arbitrum and Digitex. Therefore, the buy back and burn will be done in the following way:
The house bankroll smart contract automatically deducts 3% from every non-DGTX winning bet and sets aside 0.5% for the buy back and burn mechanism.
At this stage the set aside funds are still on the Digitex blockchain and we need to bridge them over to the Arbitrum One chain via the Digitex token bridge. The funds will likely be a combination of ETH, USDC, USDT and ARB tokens.
After bridging the funds from Digitex to Arbitrum we can now use them to buy DGTX tokens on Uniswap. We use Uniswap on Arbitrum because transactions are instant, they cost pennies and they can't be front-run. We want to concentrate and encourage DGTX liquidity on Arbitrum Uniswap because it is much easier, faster and cheaper to bridge DGTX from Arbitrum to the Digitex chain and a regular daily buy order from the buy back and burn mechanism will help to do this.
Now that we have bought DGTX tokens on Arbitrum we need to bridge them back to Ethereum before burning them. This is because DGTX is originally an ERC-20 token on the Ethereum chain and therefore all DGTX tokens on the Arbitrum chain must have been bridged over from Ethereum. If we don't bridge them back to Ethereum to burn them then Etherscan will not reflect the new reduced supply and Ethereum DGTX tokens will be locked in the bridge smart contract forever.
After successfully bridging the DGTX tokens from Arbitrum to Ethereum we can now burn them by sending DGTX to the 0x0000...0000 address. Tokens sent to this address are taken out of circulation forever and the Max Total Supply figure on Etherscan will immediately reflect the reduced DGTX supply.
The above process will initially be done manually in order to get it working smoothly and efficiently. When possible the above process will be automated via smart contracts. Whether being done manually or automatically, the DGTX buy back and burn mechanism will be a publicly viewable process that can be monitored and verified by anyone.
Last modified 9d ago