(5) DeFi

Disclaimer: here

The Bones Protocol introduces decentralized liquidity pools (LP pools) for tokens on Dogecoin L1, without the need for multi-sigs. The tokens of the Bones Protocol can be swapped with each other using in-protocol functionality, with no need for another buyer or seller to complete a trade.

Decentralized LP Pools

Each Token on the protocol is paired with $BONE (the Base Token), ensuring liquidity is available from the outset. This structure aims to facilitate straightforward and efficient trading, similar to DEXes on EVM chains and Solana.

Liquidity from minting

The liquidity for these pairs is sourced from the minting process of the tokens. Instead of directing minting fees to the creators, the fees are added to the liquidity pool. As a result, every time a new token is minted, its liquidity expands. This minting mechanism is intended to ensure a fair distribution of liquidity and to mitigate early manipulation.

The LP pool only opens for trading after the token minted out (aka is "completed").

Royalties

The Bones Protocol features a built-in royalty fee system designed to reward creators for their contributions. This system enforces royalties at protocol level, ensuring that creators earn a predetermined, transparent percentage from trading activities, paid in $BONE. These royalties can be claimed at any time and repeatedly, providing ongoing incentives for innovation.

Every swap on the protocol incurs a 1% fee allocated as royalties to the token’s creator. The creator is identified by holding the deploy inscription of that token.