The XCM token is CoinMetro’s unique native cryptocurrency. Many aspects of our platform have a direct tie with XCM making the ecosystem stronger than ever. One significant tie is the vaulting used on it to enhance our ecosystem.
Three quick keys:
100% of all fees on the platform will be used to purchase XCM;
1-50% of each XCM purchase with exchange fee revenue will be vaulted;
The XCM Utility Vault is a cold wallet with a 4-year lock.
Why is CoinMetro vaulting XCM?
Vaulting XCM strengthens the XCM ecosystem by slowly and steadily removing some XCM from the circulating markets. Displaying the amount vaulted increases our transparency and the transparency that has always characterized us as a regulatory compliance centrist exchange.
How is XCM purchased by CoinMetro?
100% of all fees on the CoinMetro platform are used to purchase XCM.
Since all exchange fees are collected in the bought currency, we complete regular balance checks and liquidate all the assets into euros. All these euros are then used to purchase XCM directly from the market each week. To avoid any speculation on fee conversions, purchasing XCM is done in batches so that a trade will not instantly result in market-bought XCM.
What percentage of purchased XCM are vaulted?
Of the XCM purchased, a percentage is instantly sent to our vault account, and a percentage is sent to our revenues account. The revenue account is to be used as we see fit although none of it has been spent or sold yet (at the time of writing).
1-50% of XCM will be vaulted. The percentage will vary between each fee conversion, based on multiple variables.
When is XCM vaulted by CoinMetro?
Once a week we empty the vault account to the vault on-chain. By moving the purchased XCM from the vault account to the cold wallet, the XCM is locked in the XCM Utility Vault.
XCM has sometimes been vaulted from other sources, such as in relation to campaigns or other special circumstances. For example, there had been a vaulting of XCM due to an initial excess in minting. This is why you see a higher number of vaulted XCM than the number of fees converted.
What will happen at the end of the vault’s locked period?
The Vault wallet is made with a smart contract release date of 08/01/2024.
As per our Whitepaper, CoinMetro’s preference is to be able to burn all vaulted XCM. It is our hope that regulatory uncertainties around burning will be clarified by the time the vault is unlocked and the potential risks have been mitigated.
Should there not be clear regulations by the time the vault is unlocked, the vision is to re-vault and likely all or most of the XCM from the vault would be re-locked. Those XCM could be put to use in the future, but that has never been the primary intent for the XCM vault. CoinMetro and the community will have come to an agreement on how this possibility would be utilized.
What about the XCM that’s not put into the vault account?
The XCM not sent to the vault is part of CoinMetro's revenue. We are building up the XCM ecosystem and CoinMetro has no intention of selling XCM revenue without reason.
After all, it is in the best interest of CoinMetro, as the largest XCM holder, for XCM to have a healthy market and price increase.
We can see that no XCM would need to be sold by CoinMetro for a long time. And when/if it is necessary, it would be sold in a way not affect the overall market.
How was the 1-50% vaulting percentage determined?
While the formula would have changed a bit, at the time of the formula’s inception, the idea was to take the average daily income versus the current income of the day, based on estimating the veracity of the transactions, and the end result of the day before.
If a certain threshold is reached, or if results were bigger than the day before, a larger percentage would be burned/vaulted, and over or above a high watermark principle would result in the max percentage being burned/vaulted.
So, the amount varies based on various factors. Some days it might be 1%, other days, 50%.
We hope that this article helped you understand more of how vaulting adds to the value of the CoinMetro ecosystem.
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