An example

This will provide an example of how gKimbo will operate in general with the current fee structure. The exact values provided are just for demonstration purposes and are subject to change.

Example of how gKimbo works:

This example will use the concept of "backing tokens" to simplify the explanation. gKimbo is actually backed by $Kimbo.

Let's say there are 10 gKimbo tokens in circulation and they are backed by 1000 $Kimbo tokens. This means each gKimbo is​ backed by 1000/10 = 100 $Kimbo tokens per gKimbo.

You want to mint gKimbo and you have 100 $Kimbo tokens to mint with. You deposit your 100 $Kimbo tokens into the gKimbo backing pool to mint the gKimbo. One percent (1%) of your $Kimbo tokens are used as a tax and distributed as seen in Fees. From your remaining 99 $Kimbo tokens, 0.99 gKimbo is minted and given to you, based on the current pool ratio of 100 $Kimbo tokens per gKimbo.

After you have minted there is now 1100 $Kimbo tokens in the pool and 10.99 gKimbo in circulation. This means each gKimbo is now backed by 1100/10.99 = 100.09 $Kimbo tokens. The backing of gKimbo has gone up!

Now let's say you want to redeem your 0.99 gKimbo. At this point, your 0.99 gKimbo is worth 0.99 * 100.09 = 99.0891 $Kimbo tokens. To withdraw, there is another 1% tax that is left in the $Kimbo token pool. Now, your withdrawal is actually 99.089 * 0.99 = 98.098 $Kimbo tokens. After this, there are 1100- 98.098 = 1001.9 $Kimbo tokens left in the pool and 10 gKimbo in circulation. This means each gKimbo is now worth 1001.9/10 = 100.19 $Kimbo tokens.

If you transfer your gKimbo into a contract, via a dex, or to another wallet a small transfer fee is applied. This fee will burn 0.25% of your gKimbo also increasing the value of the remaining shares.

This shows how the backing of gKimbo goes up with minting, redeeming, buys, sells and transfers.