Fan Tokens
Last updated
Moxie Protocol Foundation, Cayman Islands
Last updated
Farcaster Members are able to buy and sell Fan Tokens from the Moxie smart contracts.
There are 3 types of Fan Tokens available at launch:
| Fan Token Type | Description |
|---|---|
In the future Fan Tokens could extend to anything, including representations of real world assets.
Owning Fan Tokens allows for special features and benefits that can be integrated into any Farcaster experience.
Fan Tokens can only be purchased by Members on Farcaster from the Moxie Contracts and are unable to be transferred, traded, or sold outside of the Moxie Smart Contracts.
Person to person sales and transfers are not possible as per the contracts. Secondary markets are not possible.
Purchases & Sales of Fan Tokens happen through the Moxie smart contracts via:
Fan Token Auctions ("FTAs") in the Moxie Batch Auction Contracts
The Moxie Bonding Curves smart contracts
Moxie Fan Tokens differ in many ways from previous attempts at onchain "Creator Tokens." In particular:
Moxie Fan Tokens are based on utility. Being a Fan provides for numerous benefits and developers are able to permissionlessly develop and offer unlimited more use cases.
The Moxie batch auctions provide for fair pricing for the initial Fan memberships. Everyone buys in at the same price.
The Moxie logarithmic bonding curves do not allow for rampant speculation.
Only Farcaster Members can participate. There is no way for non Farcaster users to speculate and run up prices.
Any Farcaster Member or Channel can sell their Fan Tokens via an Fan Token Auctions FTAs utilize the Moxie Batch Auction Contract for fair, transparent, and decentralized token price discovery.
Only Farcaster Members can participate in FTAs which are conducted in Farcaster Frames on Farcaster. Members participate directly with the contract using their non-custodial wallet. All purchases of Fan Tokens in the Moxie FTAs are done with the batch contract and all the proceeds go into the Bonding Curve.
Batch auctions are a fair pricing method that has been battle tested in traditional finance. During the Batch Auction:
There is one auctioneer and multiple bidders.
The auctioneer defines the Sell Amount and the Limit Price for the auction. The Sell Amount is the amount of tokens the auctioneer would like to sell and the limit price is the minimum price they are willing to receive for the asset.
Once the auction is started by the auctioneer, bidders can participate by placing their bids, through Limit Orders, specifying an amount and a limit price. Bidding is done by locking $MOXIE into the contract during the auction.
The auction runs until a certain date. After this date the auction is over, and no more bids can be placed.
At the auction clearing, the auction calculates the final clearing price. This will be the price where the supply and demand curve intersect. (In the graph, it's where the red supply line meets the green demand curve, indicated by the white dashed line).
This final clearing-price will be the final clearing price for all participants.
Bidders who specified a maximum price in their limit order that is greater than the final clearing-price receive auctioned tokens at the clearing price.
Bidders that specified a maximum price in their limit order that is less than the final clearing-price do not receive the auctioned tokens, and can claim their bid $MOXIE from the contract.
Winners of the auction receive the Fan Tokens which provides them with access to the features.
Initially Airstack will facilitate the decentralized Batch Auctions Frames for Members and Channels, setting the available supply and floor price and ensuring the auction goes smoothly. Soon thereafter Members and Channels will able to launch their own Fan Token Auctions in frames. The number of Fan Tokens available in the Batch Auctions is initially set as (user/channel's follower count) x 10% = available supply in the batch auction
Batch Auction Proceeds
90% of the proceeds from the Batch Auction goes into the Bonding Curve Smart Contract for the Fan Tokens for that Member or Channel, to ensure ongoing liquidity for buy/sell orders in a decentralized marketplace.
5% of the proceeds go to the Moxie Protocol, which shall be burned initially as per governance
5% of the proceeds are allocated to the Member / Channel whose Fan Tokens are being auctioned, in the form of a distribution of their own Fan Tokens
Following the Batch Auction a Moxie Bonding Curve Smart Contract is deployed for each Fan Token. This is a self-executing fully-decentralized contract that enables continuous markets and market liquidity for each token.
Given the early stage of the Farcaster network, and our desire to have Moxie Fan Token bonding curves reward Member-utility rather than speculation, Moxie has chosen to use a logarithmic bonding curve which upholds stability as the curve unfolds.
The Moxie bonding curves are very different from previous attempts at creator tokens as they emphasize membership and utility over speculation:
The curves are relatively flat vs. exponential. Prices increase slightly with every purchase.
Only Farcaster Members can purchase Fan Tokens; non Members cannot speculate on the tokens. A Farcaster Membership ($paid) is required along with a Moxie Pass soul-bound NFT that can only be acquired on Warpcast via Frames. All purchases and sales of Fan Tokens must be within Farcaster Frames.
Fan Tokens cannot be sold or transferred outside of the Moxie contracts. The only way to sell a Fan Token is to sell it back to the Moxie Bonding Curve contract.
Each purchase or sale is made directly with the Bonding Curve. Person-to-person transfers are prohibited and secondary markets for Fan Tokens are not possible.
Each incremental purchase causes the next purchase to move up one slot on the curve, e.g. from $1.0001 to $1.0002. Each incremental sale causes the next sale to go down a slot, e.g. from $1.0002 to $1.0001.
Purchases are made with $MOXIE, which locks that $MOXIE into the contract. The purchaser receives the Fan Tokens which provides them with access to the features.
The formula for the current price of a Fan Token on the Moxie Bonding Curve is:
where:
r = the reserve ratio which is fixed at .66
s = the supply of tokens when the batch auction ended and the bonding curve is initiated
P(s) = price per token when the batch auction ended and the bonding curve is initiated
y = the current price at any moment in time
The Total Supply of each Fan Token is unlimited. Each time a Fan Token is purchased the supply increases by 1. Each time a Fan Token is sold the supply decreases by 1.
Some examples:
Fan Token for Channel A
Fan Tokens sold in Batch Auction = 5,000
Price per Fan Token sold in Batch Auction = 5,000 MOXIE
The 40,000th such Fan Token sold will sell for 14,595 MOXIE
The 100,000th such Fan Token sold will sell for 24,000 MOXIE
Fan Token for Channel B
Fan Tokens sold in Batch Auction = 20,000
Price per Fan Token sold in Batch Auction = 15,000
The 40,000th such Fan Token sold will sell for 21,437 MOXIE
The 100,000th such Fan Token sold will sell for 34,368 MOXIE
Transaction Fees
Fan Token Buy transactions
There are no transaction fees on buy transactions.
Fan Token Sale transaction
The subject of the Fan Token purchase collects a 2.5% fee on every sale of their Fan Tokens
The Moxie Protocol collects a 2.5% fee on every sale of Fan Tokens, which is currently set to be burned.
There are no other transaction fees.
Member
Allows for access to features and benefits only to the Member's Fan Token holders. A portion of all rewards earned by the Member accrues to their Fan Token smart contract, benefitting all of their Fan Token holders.
Channel
Allows for access to features and benefits only to the Channels Fan Token holders. A portion of all rewards earned by the Channel accrues to their Fan Token smart contract, benefitting all of their Fan Token holders.
Network
Allows for access to features and benefits only to the Network-level Fan Token holders. A portion of all rewards earned by the Network accrues to the Fan Token smart contract, benefitting all of the Fan Token holders.
