Simple Guide to Fan Token Auctions

Moxie Fan Token Auctions enable the initial supply of Fan Tokens to be sold for a fair price.

The auction smart contract always looks to sell the total auctioned supply at the best price it can mathematically obtain.

Here's how it works:

The amount of Fan Tokens available in the Auction = 10% of the Member's or Channel's followers. UPDATE 7 Aug, 2024: If 10% of followers < 1000, initial supply will = 1000

1. Members place bids for the Fan Tokens. When placing your bids you specify:

   1. The price in MOXIE that you are bidding

   2. Your maximum budget
2. As bids come in, The auction smart contract then dynamically calculates the clearing price at which ALL of the initial supply will be sold. More on that below 👇

3. When the auction closes -- after 72 hours -- all of the supply is allocated to the bidders, at the clearing price.

   1. Anyone who lost the auction is able to claim back their bid MOXIE from the contract.

   2. Anyone who won the auction receives Fan Tokens.

Now, about that Clearing Price

• The auction smart contract will always sell all of the available lots for the maximum profit it can obtain, without enabling anyone to pay more than they bid.

• It will look to spend the highest bidders' entire budgets, on a cost-average basis getting them the lowest price possible

• Anyone who bid above the clearing price will at get at least some of the tokens.

• Here are some examples to illustrate how that works:

  https://docs.google.com/spreadsheets/d/1T0Dz2_HZaEteBB7ZzrVtpVurvGS-CTY4gtMoXeALi58/edit?gid=0#gid=0

When the auction closes

1. Everyone who bid is notified

2. Winners can claim their Fan Tokens and any MOXIE refund required

3. Losers can claim their MOXIE refund

4. The proceeds of the auction are split:

   1. 90% to the Moxie Protocol Smart Contract Bonding Curve for that Fan Token -- this ensures constant liquidity for any future buys or sells of the FT

   2. 5% to the subject of the Fan Token auction in the form of their own Fan Tokens

   3. 5% to the Moxie Protocol as a fee which is burned

5. After the auction an unlimited supply of the Fan Tokens are offered in the Protocol Smart Contract Bonding Curve. Only the auction is supply constrained.