RE: RE: Introducing POLYCUB V2 | vexPOLYCUB, Governance UI, PIP2, Multi-Token Bridge and Buybacks

This is a good question. As mentioned in the above model though, this doesn’t come from inflation. In fact, it comes from buybacks.

What got platforms like Anchor in trouble is that they paid 20% fixed APR via inflation. This meant that as deposits went from a few million to a few billion dollars, the token was infinitely inflated.

In our case, if deposits go from thousands to tens of thousands or hundreds of thousands of dollars, that simply means more POLYCUB is getting bought off the market. That’s actually bullish for POLYCUB.

So more deposits = more buybacks in our system whereas in failed models like Anchor, more deposits = more inflation.

The only scalability issue is if the price of POLYCUB moons and vexPOPY deposits moon alongside it but PoL + MTB can’t cover 20% APR.

In that scenario though, POLYCUB’s price is extremely high which means that the APY to deposit into /farms vaults is higher. It also means that arbitrage revenue, wrapping revenue and oracle staking go through the roof.

All of these factors create a hyper-bullish effect when POLYCUB starts to move up.

The reversal question is what if POLYCUB goes down.. even better! Then the PoL + MTB revenue is getting more bang for its buck to buy POLYCUB and deposit the 20% yield to vexPOLYCUB.. taking more POLYCUB off the market each month

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