LibraProtocol (LIBRACOL)

Decentralized finance is possible using decentralized exchanges collaborating with liquidity pool smart contracts. For any token on the smart chain to be available for swapping on a decentralized exchange, it must have an available liquidity pool of tokens.

The challenge remains in properly incentivizing users to maintain these liquidity pools.

To address this, developers have implemented various tokenomic structures with incentives for users to supply liquidity into the pools. An automatic liquidity acquisition can be an alternative solution to the traditional “farming reward” structure.

An automatic liquidity acquisition function offers rewards (via reflection) instead of traditional farming rewards. These reflections distribute tokens proportional to volume, providing a more reasonable incentive for holding. Although reflection and automatic liquidity acquisition may contribute to stability, an inherent burn mechanism can achieve token scarcity by reducing the token supply.

The combination of these tokenomics aims to eliminate the flaws of previous models while providing incentives for use and adoption. Applications integrated with these smart contract functions could enhance the effectiveness of LibraProtocol’s tokenomics.

LibraProtocol is designed with three main components:

• The first is the “reflection,” where transactions are charged a fee distributed among token holders.
• The second component is a commission levied on transactions, which is allocated to various liquidity pools on Pancake Swap and other platforms.
• The third component is a token burn, with every transaction taxed at a 10% fee, split into two parts: 5% goes to staking rewards, and 5% goes to cash pools. Of the 5% sent to liquidity pools, 2.5% is converted to Binance Coin (BNB) to ensure the liquidity of the LibraProtocol and Binance Coin pair.

Some token burns will be done manually by the team.