The Ceres protocol implements value capture in the following aspects, bringing benefits to users and funds.
The Ceres protocol triggers the minting process when the ASC average trading price is above $1.05, and it only costs $1 to produce an ASC. Benefits gained from such arbitrage will be distributed to users as the value capture.
For example, if the current average trading price of ASC is $1.15 and 100,000 ASC needs to be minted, then the value of the minted ASC is $115,000, while the minting cost is $100,000, from which $15,000 is captured.
Users who invest collateral and CRS in the central bank and participate in the minting process will receive newly minted ASC and value captured in the process.
Ceres protocol triggers the redemption process when the ASC average trading price is below $0.95. At this point, the cost of an ASC from the market is below $0.95, while the redemption of this ASC can bring collateral and CRS worth $1. The difference between the cost and the benefit is the value that can be captured.
For example, if the current ASC average trading price is $0.9 and 100,000 ASC need to be redeemed, then the collateral and CRS acquired from this redemption will be worth $100,000, and the redemption costs $90,000, with a value of $10,000 captured.
Users who invest ASC in the central bank and participate in the redemption process will receive the collateral and CRS redeemed, along with the value captured in the process.
Assets in the central bank
A certain percentage of the assets in the central bank will be invested in various aggregator of DeFi, and the income obtained belongs to the treasury.
The protocol will charge 0.5% as seigniorage from the minting and redemption process of ASC, and the income also belongs to the treasury.
The profits gained through Ceres protocol will be collected in the treasury, and Ceres DAO determines how to allocate the profits by voting.