Papertrade's PAPER Minting Plan Could Dilute Early Holders

Papertrade's proposed PAPER minting formula would gradually reduce early holders' share of the token supply, giving later traders a larger relative stake when trading losses generate new tokens.

Under the plan, each $1 million in future losses would mint tokens equal to roughly 0.1% of PAPER's supply at that time. The exact proportion depends on the minting rate when Papertrade upgrades its contracts.

Trader degentrading viewed the shift as unfavorable to early participants but potentially beneficial to the protocol's longer-term development.

Papertrade also plans to change issuance when its liquidity pool approaches or enters insolvency. In that situation, a multiplier that rises over time would replace the current rate of 100 PAPER for each $1 lost. Papertrade has no current plan to enable PAPER transfers.

Papertrade mints PAPER when traders incur qualifying losses.