Deflation Mechanism & Tax

The $GEM token is designed to be highly deflationary, enhancing its value and appeal in the gembox ecosystem. Here's how its deflationary mechanisms work:

External ETH Reward Influx

An external source of ETH rewards consistently buys up $GEM tokens and partially burns them. Specifically, 10% of the rewards claimed by BOX NFT holders are funnelled into the liquidity pool.

Buy-Back & Burn

Out of the 10% rewards fee channeled into the liquidity pool, 50% of the $GEM tokens are bought back and burned. This action creates a consistent buy pressure on the $GEM token, reducing its supply and enhancing its value over time.

Sustaining Demand

This cycle not only generates demand for $GEM but also bolsters its purchasing power. By fuelling the liquidity pool with more ETH, the ecosystem ensures a sustainable and deflationary token model.

Transaction Tax

Every buy and sell transaction of $GEM incurs a 5% tax. Of this, 4% is allocated to cover operational costs, development, and marketing, ensuring the ecosystem's growth and stability. The remaining 1% is redistributed to BOX NFT holders, further encouraging participation in the NFT auctions.

NFT Ecosystem Synergy

The 1% redistribution to BOX NFTs acts as a catalyst, encouraging more active participation in NFT bidding and claiming, which in turn, increases $GEM token burning. This creates a virtuous cycle of engagement and value creation within the ecosystem.

In essence, $GEM's economy is a self-sustaining flywheel of deflation, offering numerous opportunities for participants to engage, earn, and contribute to the token's growing scarcity and value.