Trading Fee

Trading on Derify protocol requires trading fee.

Trading fees are used in 4 ways: filling insurance pool, broker reward, position mining reward and token buyback fund.

Trading fees will be distributed as follows:

Usage	Percentage
Insurance Pool & Buyback	40%
Broker Rewards	30%
Position Mining Rewards	30%

Token Buyback Fund

40% of the trading fee will be injected into the insurance pool. The overflow of the insurance pool has been used as a buyback fund for the repurchase of bonds and DRF tokens. Bonds are initiated by users and can be repurchased at any time.

Rules for DRF token buyback:

• Each Margin Token has its own independent buyback fund and buyback cycle (measured in block numbers). At the first block of each buyback cycle, the DRF price is recorded in the snapshot $CP_t$ from a DEX, PancakeSwap, or any other designated DEX

• If the Margin Token is DRF, then the remaining balance of the buyback fund is directly burned

• If the price of the snapshot $CP_t$ is lower than the price of the previous snapshot $CP_{t-1}$, the DRF buyback operation will be automatically and immediately executed. The buyback will stop once any of the following three conditions is met:

  1. The DRF price on the DEX is greater than or equal to the price of the snapshot $CP_{t-1}$

  2. The balance of the buyback fund is zero

  3. The price slippage exceeds the threshold

• The buyback is completed, and the price of $CP_t$ is updated to the latest price

The buyback fund is controlled by a smart contract and is executed automatically, with its balance being non-withdrawable. The DRF obtained from the buyback will be directly sent to the "black hole" address and burned.