Principles Driving the Protocol

The Arrayfi contract is transparent and open. Users deposit 90% of their assets directly into the underlying contract, while the remaining 10% goes to the liquidity pool for price discovery. $ARA can be traded at any price in the open market.

As the pool's funds accumulate, the protocol increases $ARA's reserve price via algorithms, keeping pace with the rising market price. Even if $ARA trades at $1 today and $5,000 tomorrow, the Treasury will increase the intrinsic price of $ARA to reduce the price gap, mitigating risks associated with price increases.

The Arrayfi protocol employs algorithmic incentives to prevent market prices from rising too rapidly and diverging too far from the floor. Although there is no limit on how high prices can go, the further they are from the floor, the more challenging it is to push them up. This helps to stabilize the market and prevent significant price fluctuations.

Pre-Arrayfi projects used the "rebase" coinage mechanism, which resulted in extra profits for early holders. But this would not happen in Arrayfi. Early holders in Arrayfi are rewarded equally to newcomers because the reserve price rises, and the premium between the market price and reserve price remains consistent throughout the currency's lifetime.