Profit-Based Funding
A core principle of CDX tokenomics is that buybacks and staker yield are funded from platform profit, not gross revenue . This distinction is critical for sustainability.
Copy Platform Revenue
↓
Operating Costs
(Infrastructure, Team, Development)
↓
PROFIT
↓
┌──────┴──────┐
↓ ↓
Buyback Staker
& Burn Yield
(CDX) (USDC) Why Profit Matters
Platform remains viable long-term
Distributions backed by real earnings
Token holders benefit when platform succeeds
Clear relationship between performance and rewards
Profit Calculation
Off-chain (standard accounting)
On-chain (transparent, verifiable)
Profit is calculated using standard business accounting practices, then distributed on-chain for full transparency and verifiability.
The Profit Split
The allocation between buybacks and staker yield dynamically adjusts based on CDX market price:
CDX Price
Buyback & Burn
Staker Yield
Why This Design?
When CDX is Below $1
Reduces circulating supply
Consistent market purchases
Drives toward $1 threshold
When CDX is At or Above $1
Rewards long-term stakers
Recognizes collective achievement
Encourages maintaining positions
The transition at $1 is called the Yield Flip :
This creates a self-balancing system that optimizes for current market conditions.
100% Burn Policy
All CDX purchased through buybacks is permanently burned :
Tokens don't sit in a DAO wallet
No Future Selling Pressure
Team can't dump bought tokens later
Supply decreases permanently
All burns recorded on-chain
Platform generates profit
Designated portion allocated to buybacks
CDX purchased from market
Tokens sent to burn address (irrecoverable)
Total supply decreases permanently
Buyback Execution
How Buybacks Happen
3/7 multisig (Conclave contractors + Cod3x Foundation)
Ad-hoc (prevents front-running)
DEX aggregator on Base network
OTC deals with >5% discount
All buybacks visible on dashboard after execution
Multisig Structure
Conclave contractors + Cod3x Foundation members
None (slippage management requires flexibility)
Why No Timelock?
Challenge
Timelock Problem
Can't respond to market conditions
Creates predictable execution windows
Reduces effectiveness of buybacks
Execution Methods
Aggregator Purchases
Best available price across DEXs
OTC Deals
Minimum 5% discount to market price
Larger purchases where DEX slippage is high
Guaranteed favorable pricing
Why Ad-Hoc Execution?
Scheduled buybacks can be gamed:
Traders buy before known buyback times
Drains value from the system
Ad-hoc execution prevents this by making timing unpredictable.
Transparency Dashboard
All buyback and yield distribution data is publicly visible:
Date, amount, price, transaction hash
On-chain proof of token destruction
Per-period USDC allocated
Platform performance indicators
Total CDX removed from supply
Only actual earnings fund tokenomics
Allocation optimizes for market conditions
No treasury hoarding or future sell pressure
Prevents front-running, maximizes efficiency
All actions verifiable on-chain
Secure but flexible execution
Q: What counts as "profit"?
Revenue from credits, subscriptions, and fees minus all operating costs including infrastructure, team, and development.
Q: How often do buybacks occur?
Profit is determined every 14 days. Buyback timing varies intentionally within each cycle. The dashboard shows all historical buybacks.
Q: What if an OTC deal is available?
OTC deals are only executed if they offer at least 5% discount to market price, ensuring buybacks always get favorable pricing.
Q: Where can I verify burns?
All burns are recorded on-chain at the burn address. Links available on the transparency dashboard.
Q: How is the $1 threshold determined?
Manual processing at each 14-day deposit cycle. Will transition to automatic oracle-based processing if the system is well received.
Last updated 2 months ago
