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MARQ is the native token issued by the Marquee insurance protocol. MARQ can only be minted or destroyed by the protocol. MARQ is backed by a basket of assets in the vault. Every one MARQ is backed by one USDT or other stablecoins. To support the parity between MARQ and USDT, whenever the price of MARQ drops below one USDT, the protocol will purchase MARQ from DEXs and destroy it. However, MARQ can be traded at a price higher than one USDT in the market. The market price of MARQ above USDT is determined by market supply and demand. The tokenomics model of MARQ is explained as follows.
The initial supply of MARQ is 2,500,000 tokens.
The changes in circulating supply will vary depending on the number of tokens that get minted, vested & burnt.
- Team: 10% (24-month linear release after listing)
- Private Sale: 10% (24-month linear release after listing)
- Consultants/Advisors: 2% (24-month linear release after listing)
- Ecosystem/Treasury: 15% (Per airdrops & operational expenditure)
- Liquidity Pool: 7% (Released at TGE)
- IDO: 1% (Released at TGE)
- Staking Rewards (Bond Mechanism Generation): 55% (Release at the set annualised rate & by the rule of monthly decay)
The mint & burn is an automatic mechanism that increases the sMARQ balance in a staker’s account. When the protocol mints new MARQ, a significant portion will be distributed to stakers. Since the staker will only see the balance of sMARQ instead of MARQ, the protocol uses the mint & burn mechanism to increase the MARQ balance so that the number of sMARQ always equals the number of MARQ. The current minting epoch is set to 8 hours, meaning that minting happens thrice a day.
By staking MARQ in the Marquee stake pool, stakers receive sMARQ and profit by taking a share of the returns from the vault. The return from staking MARQ is distributed by the mint & burn mechanism. An imbalance between MARQ and sMARQ (staked MARQ) is created whenever a bond is sold. This is when the mint & burn mechanism is activated. For more details, please refer to Stakers.
Since the amount of sMARQ is affected by the mint & burn mechanism, gMARQ is created to track the real-time valuation of sMARQ. The holder of sMARQ can choose to wrap their sMARQ for gMARQ, which is the governance token of Marquee and receives the Base Staking Rate. This rate intends to reflect the expected growth of the protocol.
How does gMARQ work?
- When you wrap sMARQ, the quantity of gMARQ you receive is equal to sMARQ divided by the Index.
- Assuming the index equals 10, you will receive 1 gMARQ by wrapping 10 sMARQ.
- Assuming the index equals 10, you will receive 10sMARQ by unwrapping 1 gMARQ.
The Index tracks the amount of MARQ accumulated since the beginning of staking. The index increases after every income distribution. Assuming the index is equal to 10, if a user stakes 1 MARQ from launch, the user will now have 10 MARQ.