HOTtub

HOTtub is a single-sided staking method for $HNC that allows users to participate in DeFi without worrying about conventional AMM-related risks such as impermanent loss.

Simply by staking $HNC, users will be exposed to three distinct reward mechanisms. In this model, yield is derived from three distinct sources: swap fees across all HOT Dex liquidity pools, yield farm emissions, and swap fees from $HOT transactions.

The 0.3% protocol fee incurred on all token swaps in featured HOT pools and 0.5% fee incurred on all HOT transactions accumulates in the HOTtub. The HOTtub contract dissolves the LP tokens from swap fees and burns them to itself, after which point it swaps the underlying assets (token 1 and token 2) for $HOT. Thereby, HOTtub creates a $HOT buyback mechanism in itself and dilutes the instant inflation spikes that can be seen on the other single-side stake protocols by spreading them over time.

In other means, the fees generated by the users are distributed to the users again.

In fact, HOTtub is a simulation of the user incentive mechanism of a COSMOS App Chain that has reached to zero inflation state.