Minting

Minting cbEGGS

Mechanism

  • Minting: You can create new cbEGGS by depositing ETH into the protocol's smart contract.

  • Fee: There is a 2.5% fee when minting cbEGGS. This fee goes straight into the protocol, which increases the ETH backing for every cbEGGS.

  • Supply Cap: Once 1,000,000,000,000 cbEGGS are minted, no more can ever be made. After that point, cbEGGS becomes truly deflationary with each transaction.

Redeeming cbEGGS

  • Direct Sell: The easiest way to get your ETH back is to “sell” cbEGGS to the contract in the ‘swap’ tab of the dApp. You’ll pay the same 2.5% fee as minting, and the leftover goes to the protocol, LP incentives, and the team at the same rates as minting.

  • Loan Redemption: Alternatively, you can redeem cbEGGS by taking a loan against your position and instantly defaulting. This sends your ETH back to you, minus the collateral premium and interest.

Minting Example

Step 1: The Starting Point

  • Imagine there are already 100 cbEGGS tokens in existence.

  • The contract is holding 100 ETH to back these tokens.

  • This means the price of each cbEGGS is 1 ETH (100 ETH ÷ 100 cbEGGS).

Step 2: The Minting Fee

  • To create the next cbEGGS token, you need to pay a 2.5% fee on top of the 1 ETH price.

  • So you pay 1.025 ETH in total.

Step 3: Where the Fee Goes

  • Out of that 0.025 ETH fee, 70% (or 0.0175 ETH) is added to the protocol’s ETH backing.

  • The remaining 30% (0.0075 ETH) is split between:

    • Liquidity provider incentives

    • The team

    • And remember, 10% of the ETH fee is burned forever, removing it from circulation.

Step 4: The New Price

  • After you mint your cbEGGS, the contract now holds 101.0175 ETH.

  • There are also 101 cbEGGS in existence.

  • The new price is 101.0175 ETH ÷ 101 cbEGGS = 1.0001732673 ETH per cbEGGS.

  • Notice how every cbEGGS becomes slightly more valuable!

Step 5: The Takeaway

  • Each time someone mints / sell new cbEGGS, part of the fee increases the ETH backing.

  • This naturally pushes up the price of every cbEGGS token.

  • It’s a simple but powerful way for cbEGGS holders to see their tokens grow in value over time!

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