Mechanics Part 4: Unstake Queue & Temple Defend
Today’s article is the final part in our series on mechanisms. The two mechanisms explored today are designed to protect the downside risk for those dwelling in the Temple.
If you haven’t read already, here are our previous articles on mechanisms:
- TempleDAO principles and the intrinsic value concept
- Mechanics 1: Safe Harvest & intrinsic value (👈 important context)
- Mechanics 2: Safe Premium
- Mechanics 3: Bonus Rewards
Let’s dive in.
#1: Unstake queue?
The unstake queue is a feature that is designed to prevent an unnecessary run, reduce volatility, and preserve fairness.
It is very simple: When you unstake your $TEMPLE, you enter an orderly queue to exit.
Every block a specific volume of $TEMPLE is processed for unstaking.
When you unstake, you are told by what block your $TEMPLE will be fully processed by and available to withdraw.
To give a simple example:
Assume 10 $TEMPLE are processed each block.
You have 3 $TEMPLE staked and want to unstake.
- 5 $TEMPLE already in the queue
- Want to unstake 3 $TEMPLE
- 5 + 3 = 8 total $TEMPLE is less than this example’s limit per block
- So all $TEMPLE are processed to exit the Temple in next block
- 8 $TEMPLE already in the queue
- Want to unstake 3 $TEMPLE
- 8 + 3 = 11 total $TEMPLE is greater than this example’s limit per block
- So 2 $TEMPLE are processed this block and 1 $TEMPLE processed next block
The queue is here to promote reduced volatility and encourage a stable, compounding family of Temple dwellers.
#2: Temple Defend?
The final piece of the puzzle.
Otherwise known as: Buy Low, Stake High.
We know crypto is volatile, that’s why we are building the Temple. There will be times when people are buying and times when people are selling.
We have a number of features in the $TEMPLE to help stabilise the protocol. A quick recap:
- Rewards Backed by Intrinsic Value
- Price Premium Ceiling reduces dumps
- Bonus APY Offer encourages buying
- Unstaking Queue stops stampedes
- Temple Defend puts floor on price
Temple Defend is the fifth stability mechanism. If selling pushes the AMM price too low, Temple Defend kicks in.
Temple Defend gives any $TEMPLE holder the right to sell at the Defend price. This means users can buy cheap $TEMPLE on the AMM and sell to TempleDAO. Users would make a profit on the trade and drive the price back up on the AMM.
This would be enough to defend the floor price of $TEMPLE.. But we wanted to make it even better for our faithful Templar.
The problem is this: If the $TEMPLE price is low and you sell your $TEMPLE to the protocol, the protocol benefits but you lose. $TEMPLE price will rise again above intrinsic value and you are left holding stablecoins (yuk).
So we added one extra feature:
Temple Defend gives you the right — but not the obligation — to sell.
This means that if the price goes back up as expected, you can keep holding your $TEMPLE and profit from the gains. If $TEMPLE doesn’t go back up, and you prefer to receive stablecoins (yuk), you can allow the sale to complete.
Here’s how it works:
A Temple Defend opportunity will be enabled when the AMM price is low, and there will be a window of time where you can buy from the AMM and stake in the Defend contract. Users will be staked for a specific length of time, by the end of which people can elect to receive back USD stablecoins (ie, complete the sale of the $TEMPLE), or transfer their $TEMPLE to the regular staking contract instead.
This means that you can help Defend the Temple price — but don’t even have to sell and miss out on future gains (unless you want to..)
Coming up next
OK so that reaches the end of our articles on mechanisms.
We will be having our next Call to Prayer next weekend on Sunday 29 August at 3pm PDT. All questions welcome.
- Development roadmap
After that .. launch.
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