AQube - One-Time General MIN Token Burn (Temp Check)

Temp Check Discussion
1

1. Title

One-Time General MIN Token Burn (Temp Check)

2. Type of MIP

Constitutional

3. Self-introduction of the Member

AQube is a specialized firm in blockchain economic research, DeFi strategy, and tokenomics optimization. The firm applies a structured, research-based methodology to token restructuring, liquidity planning, and incentive system design. Experience includes:

• Supported the generation of $400M+ TVL managed across DeFi protocols

• $6M+ fundraising supported for blockchain projects

• Strategic liquidity and tokenomics models across multiple DeFi platforms

• Produced a General Report on Minswap tokenomics, encompassing a structured review of tokenomic dynamics, liquidity and treasury management, and a framework of solutions aimed at revitalizing the MIN token’s economic design. The report serves as the foundation for the first of multiple DAO proposals on tokenomics restructuring.

4. Scope of Change

Authorize a one-time MIN burn under DAO approval and Labs’ operational authority. The burn is single-shot, not recurring. Tokens are sourced the Yield Farming Reserve (998,422,624.088847 MIN, 33.28% of total supply). The DAO selects one of the three sizing options below.

Sizing Options

Option Burn Amount (MIN) Emissions Offset (Years @ 25k/day) Remaining Runway (Years) Notional at Today’s Price ($0.02465/MIN) Post-Burn Total Supply New Circulating Supply
A: Moderate 50,000,000 5.48 103.94 $1.2325M 2,950,000,000 61.12%
B: Mid 150,000,000 16.44 92.98 $3.6975M 2,850,000,000 63.26%
C: Assertive 500,000,000 54.79 54.62 $12.3250M 2,500,000,000 72.12%

Emissions Offset definition
Years cancelled = (Yield Farming Reserve portion burned) ÷ 25,000 ÷ 365.
Note (1): For sizing and communication, the impact is expressed as years of emissions cancelled at 25,000 MIN per day, the DAO’s conservative planning lower bound and a simple benchmark for comparisons.
Note (2): In all options, 1,544,770.113963 MIN must remain reserved for MINt Redemption, so the maximum burnable from FISO is 44,789,430.442015 MIN.

5. Motivation

Minswap operates in a mature regime: liquidity and volumes are sustained by real usage and fees rather than incentives, and the protocol is backed by stable operations and treasury resources. The economics already reflect a low-emissions reality; what remains is to align the supply structure with this state. Using YFR as the source for the burn cancels a defined portion of future emissions at the 25k/day planning floor (emissions offset), and tightens the upper bound on future issuance, while preserving treasury resources for other uses.

Context: supply today (share of total supply)
Only the two buckets below are treated as non-circulating. FISO, Incentives & Partnerships, and Development Fund are vested and thus circulating, even if currently idle.

Non-circulating buckets

Bucket Share
Yield Farming Reserve 33.28%
DAO Treasury 6.64%
Non-circulating subtotal ≈ 39.92%

Circulating (vested) buckets

Bucket Share
Development Fund 7.38%
Incentives & Partnerships 2.13%
FISO 1.54%
Core Team ~0%
Other circulating (public float) 49.02%
Circulating subtotal ≈ 60.08%

The non-circulating share remains large relative to the protocol’s current needs. To bring it in line with a mature, fee-driven model, the DAO should retire a significant portion of the Yield Farming Reserve, removing excess emissions capacity that is unlikely to be deployed and sending a clear signal of supply discipline.

The sizing framework is data-driven from internal analysis and benchmarks of comparable DEXs. The community is offered three calibrated options:

  • Moderate (50,000,000 MIN): a conservative step that retires 50M from the Yield Farming Reserve. Cancels about 5.48 years of potential emissions at the 25k/day floor. Approximate notional at $0.02465/MIN: $1.2325M.
  • Mid (150,000,000 MIN): benchmarked to protocol maturity and peer DEX standards. Retires 150M from the Yield Farming Reserve, reducing idle balances sized above current needs. Cancels about 16.44 years of potential emissions. Approximate notional: $3.6975M.
  • Assertive (500,000,000 MIN): a stronger anti-inflation stance that materially reduces the Yield Farming Reserve. Cancels about 54.79 years of potential emissions. Approximate notional: $12.3250M. This is the preferred option of AQube, as it delivers the clearest signal of supply discipline.

Adopting one of these options retires a significant share of excess non-circulating supply, aligns token economics with a fee-driven model, and signals disciplined stewardship while the protocol continues its shift toward rewards funded by real activity.

6. Rationale

This burn aligns with the community’s mission to keep Minswap sustainable, transparent, and credibly fee-anchored by using a one-time action to tighten the supply map.

Supply discipline: Burning from the Yield Farming Reserve at the chosen size removes obsolete allocations and reduces the maximum path for future issuance, bringing supply in line with the protocol’s low-emissions stance.

Real-yield orientation: Shrinking reserves that historically funded emissions complements the broader move toward rewards sourced from protocol activity rather than dilution.

Protection of long-term participants: Lower potential issuance reduces dilution risk for LPs, stakers, and holders.

Proportional and focused: Three sizes let the DAO act decisively without attempting to retire all reserves at once. Other buckets such as DAO Treasury, Development, and Incentives remain available for their intended uses and are unaffected by the burn.

Net effect: the DAO removes supply that no longer serves the protocol’s needs, aligns the token’s structure with fee-based operations, and strengthens the foundation for future, revenue-funded incentive policy.

7. Key Terms

Burn
Permanent, irreversible retirement of tokens from total supply.

Circulating supply
Tokens freely transferable and available to the market.

Non-circulating supply
Tokens held in restricted buckets such as treasury reserves, emissions pools, or vesting schedules that are not presently available to trade or spend.

Emissions
Scheduled token distributions over time, typically used for incentives. Expressed as a rate, for example MIN per day.

Emissions runway
How long an emissions reserve lasts at a given rate. Runway (years) = reserve ÷ (daily rate × 365).

Emissions offset
The reduction in a protocol’s planned token distribution schedule caused by permanently removing part of the emissions reserve.

Real yield
Rewards funded by protocol revenue or external cash flows rather than by new token issuance.

FISO (Fair Initial Stake Offering)
Staking-based token distribution where users delegate stake to approved pools to earn project tokens without transferring principal. Introduced and pioneered by Minswap on Cardano in 2021 to make ISO fairer and support smaller SPOs.

8. Specifications

Platforms and Components

  • Chain and asset: Cardano L1; MIN is a native asset under the existing policy.
  • Burn mechanism: Tokens are permanently removed by sending them to a designated burn address.
  • Inputs (sources): FISO first; remainder from Yield Farming reserve per the selected option.
  • Custody: Labs multisig controls the source wallets, staging wallet, and burn transaction; signer thresholds and role separation apply.

Execution
The approved burn amount is consolidated from FISO (and Yield Farming reserve, if required) into a single multisig transaction, which sends the MIN directly to the burn address.

Data and auditability

  • Canonical public post with burn tx hash, source-wallet txids, and before/after supply tables.
  • Direct report with timestamps, addresses, amounts, and hashes for independent verification.

9. Steps to Implement

Governance

  • Temp Check: present the three size options, the burn mechanism, execution authority (Minswap Labs), and source order.
  • On-chain vote: select one option and set an execution window.
  • Mandate: authorize Labs to execute within that window up to the approved amount, with a public report after completion.

Execution

  • Pre-checks and staging as specified.
  • Submit the single burn transaction for the approved amount.
  • Confirm on chain and publish the final report.

10. Timeline

  • Forum Discussion: 7 days
  • Temp Check: 7 days.
  • On-chain vote: starts within 7 days after Temp Check passes; lasts 7 days.
  • Pre-execution setup: up to 3 business days after vote passage.
  • Burn event window: 1 business day.
  • Final reporting: within 3 business days after the burn window closes.

11. Overall Cost

External spend: $4,000 success-based consulting fee to AQube, payable only if this proposal passes and is officially implemented. This follows the cost structure approved under the AQube – Strategic MIN Tokenomics Revitalization mandate.
Network fees: minimal; reported with actuals in the final post.
Manpower: executed by Minswap Labs using existing multisig and operations; no third-party grants.
Recurring costs: none.

**Voting Options (to be extracted for the onchain vote) **

  • Burn 50,000,000 MIN from the Yield Farming Reserve (Moderate)
  • Burn 150,000,000 MIN from the Yield Farming Reserve (Mid)
  • Burn 500,000,000 MIN from the Yield Farming Reserve (Assertive)
  • No, do not pass this proposal
0 voters
8 Likes
2

I think it would be helpful if you contrast the years of eliminated emissions runway with the projected runway that remains.

IE if emissions currently last 100 years.
Moderate = -0.57 or 99.43 years remaining
Mid = -11.53 or 88.47 years remaining
Assertive= -38.93 or 61.07 years remaining

2 Likes
3

Another thought:

Burn 200M

Move 200M into a wallet specifically designated for liquidity requirements for exchange listings and market making :thinking:?

3 Likes
4

Over the past 3 years, Minswap adoption has outgrown its need for high inflation, right now we are having a sustainable inflation to stipulate growth but it makes the Yield Farming allocation taking decades to be fully emitted. That’s why I think burning the excess MIN allocation is a good move to make the circulating % reflect current protocol’s maturity. Or we could even revamp tokenomics to make it has no cap like ETH, inflation into liquidity incentives and deflation from burning fees 🤔

5 Likes
5

I think the DAO has a few millions in $min.ada-min-pol wallet that is reserved for CEXes liquidity

4 Likes
6

That’s a great way to frame it. Using the actual reserve size, the baseline runway at the 25k/day floor is about 109.47 years. After the burn, this would be:

  • Moderate: 0.57 years offset → 108.90 years remaining
  • Mid: 11.53 years offset → 97.94 years remaining
  • Assertive: 38.93 years offset → 70.54 years remaining

This will be included in the final proposal

4 Likes
7

I think 70 years is more than enough. We can burn even more.
Even now, we don’t need inflation-based interest.
I agree with burning 800,000,000 Min tokens.
Twenty years is enough.
Who’s agree with me?

6 Likes
8

:bar_chart: Option 1: Burn 400M MIN

:white_check_mark: Pros

  • Creates scarcity signal, strengthens “capped token” narrative.
  • Increases circulating ratio to 70%, reduces dilution risk.
  • Secondary investors (retail) benefit from scarcity narrative.

:warning: Cons

  • Brings no new capital to the DAO.
  • Loses “firepower” for incentives / ecosystem growth.
  • If Cardano DeFi accelerates, Minswap may run short of MIN for bootstrapping liquidity.

:bar_chart: Option 2: OTC Raise Fund

:white_check_mark: Pros

  • Immediate capital inflow (in ADA, stablecoins, or fiat) to expand product, marketing, and partnerships.
  • Strategic relationships: funds/VCs holding MIN have an incentive to help Minswap grow → stronger network effects.
  • More flexible: sales can be structured with vesting and lock-ups to prevent dumping.
  • Creates real demand for MIN (OTC buyers).

:warning: Cons

  • Weakens the “capped + deflationary” narrative (tokens are sold instead of burned).
  • If poorly managed, risk of token concentration in a few funds’ hands.
  • Market may react negatively if they see “DAO selling tokens” without transparent use of proceeds.

:compass: Balanced View

A hybrid approach could work best:

  1. Burn a smaller portion (e.g., 100M MIN) → keep the scarcity narrative and retail confidence.
  2. OTC raise fund with the rest (e.g., 200–300M MIN) → secure real capital + strategic partnerships.
  • Conditions: 12–24 month lock, linear vesting, potential governance rights.
  1. Transparent allocation of funds: proceeds should go into
  • Bootstrapping stablecoin/BTC DeFi liquidity.
  • Marketing & ecosystem partnerships.
  • Labs treasury for product development.

:white_check_mark: Conclusion

  • Burning all: good for short-term price, but misses opportunity to leverage MIN as a strategic asset.
  • OTC raise: good for capital & network effects, but must be carefully governed to avoid trust issues.
  • Hybrid strategy: maintains scarcity narrative while also using MIN to buy growth and partnerships.
1 Like
10

After burning 500 million MIN, the remaining period is 59.55 years.
59.55 years is sufficient.
It looks better to set the total supply to 2,500,000,000 MIN after the burn.

Total daily emission:25,000 MIN
Total Supply : 2,500,000,000 MIN

3 Likes
11

Selling a large amount of tokens to major investors poses a serious risk of centralization and directly contradicts the core philosophy of the Cardano ecosystem, which is modeled after Bitcoin. Even a hybrid model would not sufficiently mitigate this risk.

Moreover, the project is not currently facing a shortage of liquidity for development, meaning strategic partnerships should never come at the expense of decentralization. A project’s future is not defined by private investors but by community adoption—the decisive factor for long-term success. The history of the block size wars between Bitcoin and Bitcoin Cash demonstrates this point clearly.

To address the core tokenomics challenge—the weak link between project growth and token value—I propose burning a substantial number of tokens alongside implementing a buyback-and-burn mechanism. This approach directly aligns token value with project success and ensures the sustainability of the ecosystem.

5 Likes
12

I agree with this. I would set the max token supply to 2.5B and I would burn it all from the Yield Farming Allocation.

Burning MIN tokens in the DAO treasury is a crazy idea IMO.

6 Likes
13

As per community feedback, we have updated the proposal so that the burn is sourced entirely from the Yield Farming Reserve. In addition, the Assertive option has been adjusted from 400M to 500M MIN, which would ultimately cap total supply at 2.5B MIN. The official temp check vote will be live after 1 week of discussion will be over, so on wednesday Sept 17th

6 Likes
One-Time General MIN Token Burn - Poll
14

I support burning 500 million MIN from all FISO and part of the Yield Farming rewards.
This reduces future emissions and inflation, increases circulating supply to ~75% (beneficial for governance), and DAO revenue from trading will cover future incentives if needed.

4 Likes
15

Hybrid Approach - Attract Capital and Growth

@AQube for full disclosure how many $Min does your organization own? I personally own about 100K small fish with big dreams of slow and steady sustainable growth.

We should create a system that incentivizes and attracts growth, not just rewards current holders.

Why not employ a hybrid approach that leverages the benefits of a burn and accelerating return to existing holders (stakers) / liquidity providers. Staking has a similar effect to burning in that it locks up supply. What if the 500k approach was spread across 3 different tools to work to attract liquidity, encourage staking and long-term holding participating in the community, and also a burn.

Scenario to build a self sustaining virtuous cycle:

  1. Shock the Patient - Burn 250K immediately BURN - reduces supply and rewards existing holders of staking with larger long-term share of trading fees. Could spark momentum in the price of the $Min token to spark interest and trigger trading.
  2. Encourage Good Growth of Liquidity & Total Value Locked - Yield Farming - 100 Million annual emission target for 2 years - encourages brining more liquidity and depth and trading to $Min, reduce trading sensitivity with greater pool depth to garner institutional interest. Daily emissions target ~275K per day (the good old days of higher yields)
  3. Incentivize Ownership - Increase staking rewards for long-term stakers - ~5,000 daily emission is paltry, increase rewards to encourage ownership and participation for existing holders. Increase daily emissions by approximately 135k per day to those who lock up a staking period of 9-months to a year
2 Likes
16

YES this is a great thought process!

2 Likes
17

Your proposal would lead to significant inflation. It’s not the case that increasing yield through inflation gives users additional rewards—instead, it has the opposite effect. The market adjusts itself, and the resulting drop in token value ultimately brings yields back to the same level or even lower. This creates the perception that the token supply is unlimited, which further erodes confidence.

On the other hand, strategies like large-scale token burns and buyback-and-burn mechanisms shift the focus toward the platform’s real yield rather than inflation-based returns. This approach can drive sustainable profitability for all participants. Many projects have already shown how harmful high inflation can be to a token’s long-term value.

1 Like
18

AQube holds only the minimum amount of MIN required to submit proposals (10,000 MIN). Our role is to provide independent, research-driven analysis and structured options for the DAO to consider.

In our opinion, increasing emissions to attract growth would be counterproductive at this stage. Minswap is already a leading DEX in the Cardano ecosystem, supported by real revenue and strong liquidity. Artificially raising emissions risks diluting current holders and encouraging short-term participation rather than building sustainable growth.

This is the opposite effect of what we are aiming to achieve

3 Likes
19

My position has changed. While holistically speaking it makes sense to consider this proposal as valid, it is severely lacking.

What are the desired outcomes of this proposal? What problem is it solving? How does this proposal solve the problem statement? What evidence is there that supports the rationale? What evidence is there that the actions taken will lead to the desired outcome? How will this be tracked/monitored?

While I agree with the premise that a burn is necessary, it is not my job (I’m not getting paid) to prove why it is necessary, how large it needs to be, and what the impact of the burn is or how it will be measured.

The proposal is in an immature stage and requires further evidence to support its claim.

2 Likes
20

The incremental 100 million additional yield farming rewards would create 3.33% inflation per year for two years, however would be offset by the 250 million token burn in year 1 for a NET reduction or DEFLATION of ~5% in year 1.

How do you propose to attract additional capital without higher yield farming or staking rewards with the suggested plan?

Total value locked is hovering around 100 M $ADA granted Cardano price is up over that time, AND the more concerning issue is that monthly trading volumes are trending down towards 100 M Ada/month from highs over 250 M. MinSwap is not attracting new capital and that needs to be addressed.

Let’s focus on win win solutions that return value to current holders/stakers AND attract new capital to increase trading volumes which will reward all participants while focus on decentralization.

1 Like
21

I think the goal at this point should be to increase the value of $MIN. If its value is higher, farm incentives will take less MIN for the same incentive, extending the longevity and buying power of the project for further purposes.

I would also suggest a significant buyback program from fees that rewards stakers and pads the project.

3 Likes