Cycle Tokenomics Update

TL;DR

The Cycle token contract allowed for the supply to inflate but has been adjusted to cap the supply of CYCLE tokens at 300,000. This is irreversible and now the supply of CYCLE can only deflate or remain static.

Maximum Supply: 300,000

Current Circulating Supply: ~125,000 (yet to distribute over 50% of supply)

Full Motivation

The original vision for the Cycle token was to allow supply expansion and contraction by scaling an input amount of tokens up or down and then distributing the resulting amount as farm rewards for vaults. Controlling this effect would only be possible once the initial distribution of 300,000 tokens completes. This all takes place in the token smart contract logic.

There are a few key points motivating an adjustment:

1. As the project gained attention in mid 2021, a major source of pain was found when trying to outline this aspect of the tokenomics. Potential investors were confused and some felt insecure about a possible run away growing supply, diluting their position.
2. The project has been listed on CoinGecko and CoinMarketCap for many months now and both listings provide the maximum supply as 300,000 tokens.

In the interest of clarity, investor security, general integrity and more sound tokenomics, the decision has been made to permanently disable the Cycle token from being inflationary. This has been completed by transferring power of adjusting the scaling factor variable to a manager contract and renouncing ownership of the Cycle token contract, so this address and restriction cannot be altered or reversed. The manager contract is limited to setting the scaling factor at 100 or less, allowing for static supply and deflation but no longer making inflation possible.

Contract Address 0x78c24ab1157854355e22d1501d794aa258c606f8 | SnowTrace

Going Forward and Post Initial Distribution

The impact of this update will not really be active until all 300,000 tokens have been distributed, which at current rates should take at least another year. For the next handful of seasons, everything will continue as usual.

Once the initial distribution completes, the Cycle token will then continue distributing by feeding market purchased CYCLE from performance fees and treasury income through the token contract burn/redistribute routine. Depending on how the scaling factor value is set, Cycle will be an optional deflationary, fee redistributive protocol, supporting an evolving collection of yield optimizing strategies.

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