In the initial state of the protocol, deal fees were collected and held by the Council, which would then be distributed to stakers and LPs, with 2/3 and 1/3 of deal fees being distributed, respectively.
While this was an exciting idea, in practice, it would've meant distributing small numbers of deal tokens to many stakers — potentially making it nonviable to stake AELIN in small quantities due to gas fees. In short, there is no point in claiming dust from various tokens multiple times a month.
It is important to note that no deal fees were distributed under AELIP 3, which leads to the reasoning behind the interim deal fee distribution.
The interim deal fee distribution (Aelip 31) covers the deal fee distribution for historical stakers in pools one and two before AELIP 14.
This interim deal fee distribution will take 50% of the AELIN rewards from the initial buyback happening in the future and set it aside for historical stakers to claim. The distribution will be as follows:
Going forward, the 2% protocol fee on each deal will be collected in the underlying deal token, escrowed for six months, and then sold by the Aelin council once the escrow is complete to purchase AELIN and distribute it to single-sided stakers, LPs, and the Aelin treasury.
Deal tokens will be sold by the Council directly on an AMM or via an aggregator for AELIN tokens. If the sale of deal tokens causes more than a 1% price movement in the deal token, the sale amount will be spread out in smaller chunks over a longer time interval managed by the Aelin Council. In this case, the Council will either use a TWAMM (sell x tokens per day over y days) or manage the process manually over time.
Suppose AELIN tokens are unavailable via an aggregator or AMM where the deal token has liquidity. In that case, the Council will first buy the native chain tokens (ETH, AVAX, FTM...) and then complete a second transaction to purchase the AELIN tokens.
The resulting AELIN tokens will be distributed to the Aelin Treasury (30%) along with single-sided stakers (25%) and LPs (45%), who will claim them from staking rewards contracts on the network where the deal occurs. The rewards will be emitted over the next quarter for stakers and LPs.
Because of the non-viability of the initial tokenomics, which would've left stakers claiming dust deal tokens on many chains — the new tokenomics hopes to encourage stakers to stake and to provide continued buying pressure for AELIN tokens on the market.
These tokens will be distributed to those that support the protocol and will help to guarantee the continued success of Aelin.
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