Popular DeFi project Jointer, built on the Binance Smart Chain, continues to attract a lot of positive attention with their deep financial engineering. The Jointer Daily auction system offers daily discounts and incentives on JNTR, which have been well-received so far. Now is a good time to look at the Law of Scarcity powering some of the decentralized financial modeling built into Jointer’s DeFi suite.
The Core Vision of Jointer
Building a real estate-backed DeFi solution requires a very different mindset compared to more traditional decentralized finance services. For Jointer, it is all about creating a liquid economic structure with natural high demand and low supply in the secondary market. Thanks to the underpinning of automated protocols, scarcity occurs in its natural form through the primary Auction and the secondary markets.
Several key factors are at play to make this vision come true. Suppression of the JNTR daily appreciation plays a crucial role, as does the daily contribution cap. At its core, Jointer’s Daily Auction provides investors with 90% downside protection, a feature that cannot be overlooked. While Jointer is not built to skyrocket overnight, these systems set up an opportunity for JNTR to do 10,000X a year just by staying consistent.
Furthermore, Jointer developed 52 smart contracts on top of basic protocols to provide extra features, including network staking, premium buy orders and investment power. All of this is combined with a gateway to the secondary market that locks all pre-minted JNTR, protecting investors for large holders dumping as the price appreciates.
Leveraging the Law of Scarcity
The Law of Scarcity is best visible when looking at how JNTR’s daily appreciation remains in place. More specifically, this measure is put in place to ensure Jointer has longevity to it, rather than catering to those seeking quick profits which hurt the next investor in line. As the Daily Auction provides a discounted JNTR price, because there is a bonus for leading the investment round, combined with daily investment limitations, there is incentive for investors to quickly buy out the entire day’s supply.
One of the smart contracts built by the team ensures JNTR’s appreciation is limited to 120% per day. If the price rises above this level due to market traction, funds will be transferred from the Main Reserve to the Side Reserve to balance the price without manipulation or without the user ever noticing.
Another good example of the Law of Scarcity is how the supply of JNTR will always be driven by demand. To ensure this remains in place, the number of contributions needs to scale in conjunction with market liquidity. Investments are, as a result, capped at a maximum of 150% compared to the previous day. Placing a maximum daily minting amount, increases the speed and fear of loss investors face early on in the Auction.
In a different iteration, this concept of scarcity applies to the Daily Auction as well. Participation requires users to own JNTR. This helps limit the amount of tokens to be sold on the secondary market, while also increasing buying demand. This also applies to one’s investment power: users can invest up to 100% of their unlocked and unstaked JNTR holdings in the Daily Auction. If a user wants to invest more than 100%, they need to obtain more JNTR from the secondary market.
Exploring Premium Buy Orders
One of the more interesting concepts about Jointer are the premium buy orders. Even if a user partakes in the Daily Auction and achieves the 50% group bonus, it is still worthwhile to buy JNTR on the secondary market. Paying a small premium first will allow investors to scoop up bigger amounts of JNTR through the auction in the future.
One also has to take premium fees into account in combination with the Daily Auction discount. There are many ways to net a profit with JNTR, even if the market price is higher than the current Daily Auction value.
All of this will depend on the secondary market pricing. Jointer restricts pre-minted assets and the ongoing supply from hitting this market. All pre-minted JNTR are restricted from accessing the secondary markets directly. Nor will they show up in Liquidity Reserves, Atomic Swaps, or SmartSwap.
With the help of a digital escrow contract, this aspect of the Law of Scarcity can be maintained at all times. It is also this contract responsible for powering JNTR assets being moved to the Gateway. This Gateway interfaces with the secondary market to make trades based on algorithmic calculations dictating market demand. As soon as a sell order completes, proceeds are sent to the escrow contract and distributed pro-rata.
While there are more laws the Jointer DeFi ecosystem employs, these two are a great starting part for users. All the decentralized financial engineerings are built directly in smart contracts, free from manipulation.
Find out more by visiting Jointer.io!
Looking to advertise? We will gladly help spread the word about your project, company, or service. CryptoMode produces high quality content for cryptocurrency companies. We have provided brand exposure for dozens of companies to date, and you can be one of them. All of our clients appreciate our value/pricing ratio. Contact us if you have any questions: [email protected]