Empty Set Crypto
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How Empty Set Crypto Works

Brief explanation of ESC's mechanisms
Empty Set Crypto incentivizes market participants to voluntarily increase or decrease the token supply, provide liquidity to ESC trading pairs, and positively contribute to the long-term success and adoption of the asset. Further, the protocol leverages a variety of mechanisms to incentivize token holders in a game-theoretic battle that is carefully designed to drive the token price to trade at or near its peg.
The core mechanism of ESC is Voluntary Elastic Supply through Rebase:
  1. 1.
    ESC trading < 1 CRO
If the token price is below the peg, token holders must be incentivized to contract the token supply as doing so will help to get the spot price back towards the peg. To do so, the DAO issues so-called Coupons (debt). To purchase Coupons, users burn their ESC, thereby reducing the circulating supply. This is incentivized as you always purchase Coupons with an added discount which depends on the debt ratio (Debt/Circulating supply) in the system. Once there is a positive rebase event, the DAO mints a programmatically sufficient amount of new ESC. In this case, an equal amount of Coupons will be redeemable for ESC. Coupons have expiration dates of 365 days after purchase.
2. ESC trading > 1 CRO
We must also consider what happens when the price of ESC goes above its peg. As the token price moves above the peg, the token supply needs to expand in order to push it back down. In a positive rebase event, the DAO mints an appropriate amount of new ESC. In this case, an equal amount of Coupons will be redeemable for ESC and the remaining Coupons (debt) will automatically be cleared. If any ESC remains after all existing Coupons have been redeemed, the bonded ESC holders and liquidity providers (LPs) will be rewarded.
After all existing Coupons have been cleared, the entire supply extension will go towards bonded ESC holders and LPs.