Circulation and Buy Back Mechanism
The ecosystem and treasury are supposed to get returns over time and grow the treasury. Let's say in any given month, x amount of returns and fees over time are generated through the ecosystem.
If x is $10 million, then a portion of it, let's say x/2, will go to the buyback of created tokens, and $5 million will immediately go to the treasury return.
This $5 million worth of buyback in created tokens automatically leads to the treasury having more created tokens. Whatever is bought back as created tokens can be redistributed to different pools, like ecosystem pools for developers, users, other application creators, and asset managers.
It gets distributed to users and stakeholders through these pools. Additionally, token holders who have invested or locked their tokens can gain staking rewards from the buyback, and there's also a reserve element.
The formula for the percentage that goes to each pool is based on a dynamic algorithm.
This algorithm allocates to the right pool based on the circulating supply's nature, the reserve, and whether the pool already has some tokens or is distributing some tokens. This balance ensures that the buyback gets distributed to the right pool and, through the pool, to the right people representing rewards.
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