When the DAO’s investment cycle exceeds expected returns, which are then used to support buybacks and further reduce $QD supply.
(1) 100% of the period's sell taxes collected is awarded to stakers in the form of $QD, automatically sent to the staking contract and initialized in a decentralized fashion.
(2) In a typical period(after bonds are implemented), when the DAO’s investments perform above a set threshold, bonds are repaid and any excess is allocated to buyback and burning. When the investment cycle earns more than +5%, bonds are repaid appropriately and excess is split between stakers and bond holders as a bonus in the form of recaptured $QD.
Before the release of bonds, a community vote will be performed as to whether the staking rewards should be used as an underlying buffer towards mitigating bonds' losses. If passed, the staking rewards would be held in escrow and awarded after the cycle is complete. This allows the staking rewards to avoid minting to satisfy bonds, lending greater safety to the DAO.
Bonuses are capped at 50% of the final cycle balance, thereby preserving the thesis of being able to still burn $QD for each cycle. Excess of this erodes the ability for effective buyback. See the Google Sheet for calculations.
Note in this scenario, where the weekly cycle ROI is 1,000% (10x), the bonus rate would theoretically climb to 488%, which would of course erode the cycle balance. By capping the maximum bonus return rate, bonds receive an additional $5,000, stakers earn an additional $135,500, and $120,250 remains for burn, preserving benefits to both the core thesis/token holders.
Alternatively, under a 108% ROI (+8%), during a cycle where $20,000 of weekly tax revenue has been generated, and $10,000 of bonds have been issued at a 2.5% return rate;
3% saved for gas reserves (1.5%, unused is rolled over into the next cycle) and minor routine costs (1.5%, salary for moderators, ongoing social media subscriptions, web server, etc)
