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Introduction to Carpet DeFi

Carpet DeFi is a protocol designed to always gradually increase holder value. Your CARPET holdings will always grow in value over time, the price of one CARPET at any moment is always greater or equal to the Carpet price in any other previous point in time.

Carpet DeFi does not promise a 10x moon pump in a month, but when it comes to a longer-term saving rewards scheme that utilises its tokenomics to best serve its investors, Carpet DeFi is the safe choice.

Carpet DeFi will launch on the Avalanche C-Chain.

Terms explained​

Carpet​

Carpet is the main protocol token. Taking part in Carpet DeFi means hodling Carpet.

Counter​

The counter is our exchange. It is where Carpet can be bought and sold. The Counter will incur a buy tax and a sell tax to make the protocol function. The counter mints Carpet on any buy and it burns Carpet on any sell.

Buy tax​

On every buy of Carpet from the Counter, a buy tax is incurred. The buy tax is the percentage amount of Carpet that the counter does not mint on a buy. Over time as the protocol matures, the buy tax will go down, but it will never reach zero.

Sell tax​

On every sell of Carpet, a sell tax is incurred by the Counter. The sell tax is the percentage amount of Carpet that the counter burns but does not return stablecoins for.

Backing Treasury (BT)​

The backing treasury, or BT, is a treasury full of stablecoins and/or yield bearing assets based on stablecoins that reflect the value of Carpet at any time via the following formula: BT value / Carpet supply = Carpet Price

Genie Sweat Shop (GSS)​

The Genie Sweat Shop, or GSS, has the function of dividing the part of the taxes which do not end up in the BT into the Risk Treasury, the DAO Treasury and the NFT Airdrop Treasury.

Risk Treasury (RT)​

The Risk Treasury, or RT, is a treasury with which the team will invest into other protocols with the aim of acquiring profit for Carpet holders. The Carpet DeFi team's investment department will make trades and investments of its own volition but will also consult the community of Carpet holders via discussions and votes on what the community deems to be good investments.

NFT Airdrop Treasury (NFTAT)​

The NFT Airdrop Treasury, or NFTAT, is a treasury with the express purpose of rewarding Carpet DeFi NFT holders. Before the first NFTs are minted, the NFTAT will simply passively accumulate value. From the first minting onwards, the NFTAT will be used to reward NFT holders once every four weeks by using 20% of its total value to buy Carpet at the Counter and airdrop it to NFT holders.

DAO Treasury (DAOT)​

The DAO Treasury, or DAOT, will take care of the protocol expenses, including gas fees, marketing, site hosting and more.

What? How?​

The following assumes you have basic knowledge of how AMMs (automated market makers) work, and what buy/sell taxes are.

Good question. But first, you have to forget all that you know about decentralized exchanges.

The protocol token CARPET is backed by a basket of stablecoins. Currently we plan to launch with USDC, but in the future, more stablecoins will be added.

You can only trade CARPET with the Counter (our protocol-run exchange), rather than an external AMM, we call this Protocol Owned Liquidity 2.0. The protocol charges exchange fees, which make the price go up.

Price is determined by a simple formula, the total backing value / total CARPET supply.

Assumptions

Let's assume here now that the total backing is 1,000$, the total supply is 1,000 CARPET (meaning price is 1$), the buy/sell tax is 20% of the transaction, and 18% is sent to the Backing Treasury.
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Except during special events, 60% of the tax is sent to the BT. The other 40% (in the form of USDC) is sent to the GSS.

When you purchase CARPET from the Counter, you pay, for example, 100 USDC. The protocol only gives you 70% of that due to the fee, so you get 70 Carpet. The Backing Treasury however went up by 88 USDC and the Genie Sweat Shop received 12 USDC.

Now, let's see the price formula again: (1000 + 88) / (1000 + 70) ≈ 1.0168

The CARPET supply only went up by 70, but the backing value went up by 88 USDC. This causes price per CARPET to go up by ~1.68% to ~1.0168! Price goes up, because BT value increases proportionally more than the supply does.

Why not just stake stablecoins?​

The Carpet protocol will not only earn from lending out stablecoins on safe platforms but will also earn from Risk Treasury investments.

Suggested reading order​