BlockchainAdvanced#DeFi#Tokens#Elastic Supply
Rebase Token
R
Definition
A token with an elastic supply that automatically adjusts (increases or decreases) each holder's balance periodically to target a specific price — no transactions needed.
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Concept Diagram
Key Takeaways
1
Rebase tokens automatically adjust every holder's balance up or down to target a specific price.
2
Positive rebases increase your balance (supply expands), negative rebases decrease it (supply contracts).
3
Olympus DAO popularized rebasing with 100%+ APY, creating the '(3,3)' game theory cult in 2021.
4
Each rebase may be a taxable event — track every adjustment for tax compliance.
Practical Example
You hold 100 AMPL tokens at $1.50 each ($150 total). The protocol targets $1.06. A positive rebase occurs — your balance increases to 140 AMPL. Price adjusts to ~$1.07. You now hold $149.80 worth of AMPL but with more tokens.
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Related Terms
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Liquidity PoolA collection of funds locked in a smart contract used to facilitate trading by providing liquidity on decentralized exchanges.
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StakingThe process of locking up digital assets to support a network's operation in exchange for newly minted rewards.
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TokenomicsThe study of the economic quality of a cryptocurrency, including supply, distribution, and utility factors.
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