GemUSD additional issuance and profit sharing
Logic for issuing additional GemUSD
If the TWAP (Time-Weighted Average Price) of GemUSD exceeds $1.10, a new GemUSD will be minted according to the following table.
| GemUSD TWAP | Mint amount | Example |
|---|---|---|
GemUSD <= $1.10 | No mint | 1 GemUSD is not minted when GemUSD's TWAP is $1.09 |
GemUSD > $1.10 | Varies between 3% and 0.5% (see table below) | When GemUSD TWAP is $1.12 and GemUSD has 3 million outstanding, 3%, or 90,000 GemUSD, will be minted |
The number of mints will gradually decrease as the total number of mints issued increases.
The TWAP refers to the Oracle.
Epoch time
The TWAP is determined once every 24 hours to determine if the TWAP exceeds $1.10. This time unit is called Epoch.
1 Epoch = 24 hours
Distribution
The GEM Hedge Fund will sell additional GemUSD issued to the market on a dollar cost averaging basis. The marginal gain from the sale will be distributed in proportion to each user's GemUSD lock volume.
Amount received from sale - (Redemption reserve per GemUSD x number of additional issues) = Total distribution
Example: Additional issue 900,000 GemUSD sold at an average of $1.15 1,035,000 - (1 x 900,000) = $135,000 total dividend
If 20,000,000 GemUSD locked 20,000,000 / $135,000 = $0.00675 dividend per lock
If a user locks 10,000 GemUSD at a cost of $10,000 10,000 × $0.00675 = $67.5 dividend per Epoch (*) This number is a rough estimate since not all GemUSD are sold within one Epoch.
Treasury（20％）
As a treasury, 20% of the additional GemUSD issuance will be held by GEM hedge funds.
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