Pursuing our goal of making DeFi more accessible to everyone, we have carefully designed the Argano ecosystem where every token issued has its own mission. While we have briefly touched upon the topic of tokens in our first, introductory article, today we will do a separate one, carefully explaining all the details.
AGO, the heart
At the heart of the Argano platform lies the native governance token AGO. AGO will become a direct reflection of Argano’s performance, and provide a clear benefit for the liquidity providers, and other participants. Let us outline all the perks you may receive if you’re an AGO token holder.
The governance
First and foremost, AGO is a governance token. Meaning, only AGO holders will have a right to participate in the crucial voting, having a say on the further direction of the project development.
The voting will be conducted on the SnapShot platform, and will allow you, a token holder to vote for:
- the introduction of the new features,
- adding new liquidity pools and token pairs,
- migrating to version 2.0,
- releasing new synthetic tokens,
- adjusting calculations.
The reward
As you probably know already, the Argano platform will have 3 vaults for staking (initially), while also allowing users to engage in liquidity mining. For their service, every liquidity provider will receive rewards in AGO tokens.
Lower fees
In order to present even more utility to the AGO token, we have decided to let the platform’s fees depend on it. You heard it right. Simply holding the AGO token in your wallet will lower the redeeming fees for you from 0.4% to 0.2%. This system will introduce more value to the token and will help the Argano users save money on their interactions with the platform.
As you figured, we are trying to introduce more value to the AGO token with every single utility decision. Another strategy used for this purpose will be Buyback & burn.
To prevent token price inflation, and make it more rare and valuable for its holders the Argano team has a certain plan of decreasing the total supply of the AGO tokens up to 30% quarterly and during the next 5 years
The buyback & burn will work in the following way: the fees accumulated in the Treasury from the user’s interaction with the platform will be used to buy the AGO tokens from the open market. The tokens purchased will be burned shortly after the buyback.
The AGO token is also supported by the fixed total supply that will not increase over the years. See the tokenomics for all the numbers and allocation details:
$AGO total supply — 52,000,000:
Vault staking rewards — 13,000,000 (25%)
Liquidity mining rewards — 20,800,000 (35%)
Initial liquidity — 2,600,000 (5%)
Development — 5,200,000 (10%) including linear 6 months vesting period
Official team members — 7,800,000 (15%) including linear 6 months vesting period
Fundraising event — 5,200,000 (10%)
AGOBTC & AGOUSD
Within the Argano ecosystem, there will be running 2 synthetic, algorithmic and partially collateralized: AGOBTC and AGOUSD. Their main goal for the system is very simple — to provide more liquidity into the Argano DEX, and attract more investors. Besides the operation with synthetic tokens, Argano offers a safer and more predictable way of liquidity mining.
Bringing in the details:
AGOBTC
Today’s crypto market is centered around Bitcoin, there is no denial to that. It fully reflects the bearish or bullish market conditions and has endless prospects for the future. Us issuing the AGOBTC token will allow us to catch the attention of institutional investors that have long-term expectations. The price of the AGOBTC token will be pegged to the Wrapped BTC price, which works on the Polygon as Proof of Stake token, and in its turn, is pegged to the authentic Bitcoin price. If you’re wondering why we are working with the Polygon sidechain, and not on the Ethereum network, we recommend reading this article here that explains our choice in detail.
Getting back to the AGOBTC token, here is why working with it is better than simply holding Bitcoin in your wallet. On the Argano platform, you can stake the AGOBTC token, which, a reminder, costs and grows the same as its original counterpart and earn the AGO token for your service. It won’t be idle-sitting in your wallet but can help you grow your capital — all in one click.
AGOUSD
AGOUSD is pegged to $1, allowing you to transfer all your dollar savings 1:1. One of our goals as a project is to offer people an alternative way of saving money. Traditional finances cannot offer the same investment rates as DeFi — that’s a fact. But also, if you’re feeling iffy about buying cryptocurrency, you can still operate with the good-old dollar. On the Argano platform, you can stake the AGOUSD stablecoin, and have it work in your favor.
How does the price regulation work?
We mentioned before that AGOUSD and AGOBTC are partially collateralized tokens. Partially collateralized means that they are backed by a combination of tokens, in our case it’s USDT and WBTC, and Argano protocol’s share tokens such as CNUSD and CNBTC which are driven algorithmically by the market principles of supply and demand.
So, for example, if there is a need to mint — create — new AGOBTC/AGOUSD, it will be done by depositing a combo of USDT/WBTC + share tokens CNUSD/CNBTC, in a ratio predetermined by the system. The idea is that in total, the amount of both the collateral token, and the share tokens together, will equal exactly the price of Bitcoin or USD respectively. The ratio will depend on the Target Collateral Ratio, which represents the Collateral Ratio the protocol continuously tries to achieve. The minting formula goes as follows:
That’s about it for minting new tokens, what about redeeming?
The process of redeeming implies returning AGOUSD/AGOBTC back to the protocol and, in return, receiving back the user’s collateral assets (USDT/WBTC) and the required amount of share tokens (CNUSD/CNBTC). This in turn means that with every $1 value, users will receive part of the collateral together with the part of share tokens. If during minting we were using the Target Collateral Ratio, the redeeming formula will be using the Effective Collateral Ratio, which is equal to the ratio between the total value of collateral assets and the total value of algorithmic tokens in circulation.
If you’re looking for more technical information, we encourage you to check the project’s documentation.
In simple words
In the general sense, if the algorithmic token price is higher than the price of USD (in the case of AGOUSD) or the real Bitcoin price (in the case of AGOBTC), the protocol will apply the lower collateral ratio to create new tokens. And vice versa, when the algorithmic token price is lower than it’s needed, the protocol will increase the ratio automatically.
When the market price of AGOUSD is above $1, users are able to mint new tokens for the total $1 value, then sell those minted tokens at the inflated market price.
When the market price of AGOUSD is below $1, users can take the opportunity to purchase tokens cheaper and redeem them for exactly a total value of $1.
How do I get AGOBTC & AGGOUSD?
You can freely exchange your USDT, USDC, DAI, TUSD for AGOBTC/AGOUSD with the help of the Argano DEX, powered by minimal slippage and token price stability.
