Vitality “Hyperloop” Economic Model — Summary
What “Hyperloop” means here:
A self-reinforcing economic flywheel that compounds price, utility, and collateral strength across the Vitality ecosystem. It leverages:
a permanently locked on-chain reserve,
deflationary fee mechanics,
staking inflation tuned to participation,
yield from whitelisted PulseChain assets, and
predictable, rules-based distribution. vitality-project.gitbook.io+1
Core pillars
Permanent collateral base. The Vitality Treasury Trust (“VTT”) locks 4.32 b VTY in a multi-sig Cold Safe; those tokens are never sold. Their mark-to-market value floats with the market price set by the circulating supply (initially 888 m). This creates a hard, visible reserve that strengthens as price rises. vitality-project.gitbook.io+1
Deflationary pressure from usage. In-app transactions, stake-set and stake-end fees, subscriptions, and the “Proof of Benevolence” feature route to buy-and-burn addresses (no expectations), continuously reducing float as activity scales. vitality-project.gitbook.io
Programmed inflation for stakers. Staked Vitality earns at 4.32% annual inflation (on circulating supply), plus CHI based on the CHI-Share formula; more stakers → lower per-staker returns, making booster NFTs valuable. vitality-project.gitbook.io
CHI x NFT loop. CHI (earned while staking) is burned when minting utility NFTs that unlock multipliers/amplifiers, further incentivising staking and app use. vitality-project.gitbook.io
Treasury yield sleeves on PulseChain. The VTT accepts whitelisted assets (e.g., PLS, PLSX, HEX, INC, pDAI, pWBTC, bridged blue-chip stables) and allocates them to conservative, audited strategies (lending, stable-stable LPs, native staking, HEX ladders). No leverage/recursive loops. vitality-project.gitbook.io
Rules-based distributions. Realised net yield flows to the Hot Safe then distributes on a fixed cadence (e.g., weekly) per Snapshot approval with a default split favouring user yield programs and ecosystem growth. vitality-project.gitbook.io
The Hyperloop flywheel (step-by-step)
User actions → burns. Spending, staking events, and subscriptions trigger buy-and-burns → circulating supply shrinks as adoption grows. vitality-project.gitbook.io
Staking attracts holders. 4.32% staking inflation (plus CHI) rewards longer-term alignment; CHI then fuels NFT minting (and is burned), which boosts in-app rewards and makes staking more attractive. vitality-project.gitbook.io
Treasury builds yield & credibility. Whitelisted PulseChain assets (not VTY) generate realised yield via pDAI lending / stable LPs, pWBTC lending or LPs, PLS native staking, PLSX liquidity, HEX time-locks—without leverage. Yield accrues to the Hot Safe. vitality-project.gitbook.io
Yield redistributes to users & growth. Default policy allocates the majority of realised yield to Borrowing & Lending Against Trust using VTY (User Yield), with set portions to in-app rewards, investment staking, community grants, DAO ops, and a no-expectations reserve—kicking more utility back to participants. vitality-project.gitbook.io
Utility → demand → price. As users chase boosts, yield access, and app features, demand for VTY rises while burns reduce supply. Price appreciation strengthens.
Price ↑ → collateral ↑. The 4.32 b VTY locked in the Cold Safe revalues upward with market price, deepening the perceived backstop for the entire ecosystem (though it’s never sold), improving confidence and attracting more integrations and liquidity. vitality-project.gitbook.io
Stronger backstop → more adoption & assets. More partners deposit whitelisted assets to the Treasury sleeves, expanding yield capacity, which then feeds steps 3–4—closing the loop and accelerating the system.
How the Treasury sleeves power the loop (illustrative)
pDAI sleeve (conservative income): Supply to reputable PulseChain money markets and/or stable-stable LP (e.g., pDAI/bridged USDC) → variable APY + swap fees; strict peg monitoring, zero leverage. Purpose: predictable baseline yield that funds distributions. vitality-project.gitbook.io
pWBTC sleeve (BTC-beta + fees): Lending where listed and/or LP (pWBTC/PLS or pWBTC/USDC) sized to liquidity/volatility → fee income plus BTC exposure. Purpose: risk-aware upside without recursive loops. vitality-project.gitbook.io
PLS, PLSX, HEX sleeves: Validator yield (PLS), DEX-aligned liquidity (PLSX, with INC incentives), and laddered time-locks (HEX) under governance caps—each with explicit risk controls. Purpose: chain-aligned participation and diversified cash-flows. vitality-project.gitbook.io
Governance, controls, and trust assurances
Dual-Safe architecture: Cold Safe (long-term reserves + TokenLock for 4.32 b VTY) vs Hot Safe (ops float) with scope guards and spend limits. No external posting of locked VTY as collateral. vitality-project.gitbook.io
Execution & transparency: Snapshot voting; module/guard execution path; published addresses, whitelists, per-asset caps; monthly on-chain reports; optional proof-of-reserves-style monitoring. vitality-project.gitbook.io
Risk policy: Only official bridges/wrappers; tiered stablecoin risk; LP variance triggers; per-venue caps; hardware-only signers and rotation procedures; distributions occur post-facto on realised yield (no forward-yield promises). vitality-project.gitbook.io
Tokenomics alignment that amplifies the loop
Initial supply & inflation: Launch with 888 m max initial supply; 4.32% CPI applies only via staking pools / time deposits / NFT charging / in-app reward contracts. Effect: inflation is earned by aligned participants while fee burns counterbalance float. vitality-project.gitbook.io
Burn routes & “no-expectations” framing: Multiple fee types route to burn with explicit “no expectations of profit from the work of others” on-chain. Effect: usage reduces supply while remaining compliant with the project’s community-driven ethos. vitality-project.gitbook.io
Hyperloop in one line
Activity → Burns → Scarcity → Price ↑ → Treasury Collateral ↑ → Yield ↑ → User Rewards & Utility ↑ → More Activity. The locked 4.32 b VTY anchor plus deflationary mechanics and rules-based, real-yield distributions turn adoption into a compounding collateral–utility flywheel. vitality-project.gitbook.io+1
Practical KPIs to track the loop’s health (suggested)
% of supply staked; monthly burn rate; net issuance (inflation – burns)
Treasury TVL by sleeve; realised yield per sleeve; distribution cadence hit-rate
Liquidity depth (VTY/PLS, VTY/stable); slippage at target trade sizes
App DAUs/MAUs; subscription volume; NFT mints (and CHI burn)
Mark-to-market value of the locked 4.32 b (reference metric), and runway buffers vitality-project.gitbook.io+1
If you’d like, I can adapt this into a GitBook-ready page or add a one-page diagram that visualises the Hyperloop flywheel with arrows and flows.
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