Buybacks and burns

Mog allocates trading revenue to buying and burning MOG. Burns permanently remove purchased tokens from supply.

What funds buybacks?

At launch, 70% of every trading fee funds buybacks: the open fee and the profit fee alike. The remaining 30% funds protocol operations.

The buyback share of a profit fee is paid with the winning trade’s payout, at the same time and at the same rate. If part of the payout waits in the payout queue, that part of the fee waits with it. The buyback share of an open fee is paid when the order fills.

Above 5 million USDG of available treasury equity, a growing share of net treasury growth also funds buybacks. Earlier deficits must be recovered before new growth qualifies.

More equity, a larger buyback allocation

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Applies to eligible net cash growth after settled profits and prior deficits.

View the allocation curve

$$z=\max(F-T,0),\qquad g(F)=\frac{z^2}{z^2+T^2}$$

$F$ is available treasury equity, and $T$ is the threshold, 5 million USDG at launch. One number sets where the allocation starts and how fast it grows. Governance can change it after the timelock delay. The same threshold sets the liquidation buffer multiplier.

From revenue to burns

How buybacks work

1. 1
   FundPay the buyback wallet.
2. 2
   BuyPurchase MOG.
3. 3
   BurnRemove purchased tokens.

No fee is paid ahead of a trader payout. The allocation from treasury growth is paid only when trader claims remain fully cash-covered. Purchases then depend on the operator and market liquidity.

When the buyback wallet gives up its allocation

The buyback wallet can give up allocation from treasury growth that Mog has not yet paid to it. This allocation already waits behind every trader payout. Giving it up mints no MOG and pays no trader sooner.

Afterward, the treasury keeps the amount given up: once the queue clears, that part of the surplus is never paid to the wallet. Allocations booked after the give-up are still paid. A given-up allocation funds no buyback.

Fees cannot be given up. Every fee is paid as its trade’s payout is paid.

MOG’s price depends on market conditions. See Token risks.