1. Protocol Overview
MOON is an ERC-20 token that trades freely on a decentralized exchange. The protocol does not peg, mint-on-demand, or redeem the token. Instead, an on-chain oracle publishes a transparent reference value derived from public jackpot data, and the market decides where MOON actually trades relative to that reference. This makes MOON an event market on the Powerball cycle rather than a collateralized stable instrument.
2. Oracle Reference Model
The oracle publishes three numbers each cycle. None of them is a price the protocol will honor — they are context for traders.
- Oracle value = $10 × (jackpot$M / $20M) — scales linearly with the jackpot from a $10 base at a fresh $20M reset.
- Reset risk = 1 − e−(jackpot$M × 0.4) / 292.2 — the modelled probability of a winner on the next draw, growing as the jackpot climbs.
- Risk-adjusted value = oracle × (1 − p) — the oracle value discounted by the survival probability (1 − p).
The raw oracle value scales linearly with the jackpot from a $10 base at a fresh $20M reset. Reset risk p is the modelled probability that the next draw produces a winner, growing with ticket sales as the jackpot climbs. The risk-adjusted value discounts the raw value by the survival probability (1 − p) — a more conservative reference as a draw approaches.
3. Consensus & Confidence
The jackpot figure is sourced from multiple independent providers in parallel: powerball.com, usamega.com, calottery.com, and texaslottery.com. A value is only published once at least two sources agree within a $5 million tolerance.
High ≥ 3 sources agree — published immediately.
Medium exactly 2 sources agree — published with medium confidence.
Low fewer than 2 sources — value held, not published.
Post-draw (Mon/Wed/Sat after 10:59 PM ET), polling automatically tightens to 60-second intervals until consensus is confirmed, ensuring fresh jackpot resets are captured quickly.
4. No Redemption, No Liability
There is no mint or redeem function exposed to users and no promise to buy MOON back at any price. The protocol holds no liability against the circulating supply, so it cannot become undercollateralized and there is no health ratio or redemption haircut to manage. The only way in or out of a position is to trade with other participants in the liquidity pool.
5. Liquidity & LP Economics
MOON trades against USDC in a constant-product DEX pool on Base. Liquidity providers earn swap fees and bear standard impermanent-loss exposure. Because the jackpot cycle is mean-reverting — the reference climbs through a cycle then snaps back at reset — LPs face elevated impermanent loss around reset events. The pool launches at a 1% fee tier to compensate LPs for this asymmetric risk.
Protocol skim: a portion of each swap fee is routed to the treasury at the router layer — separate from and in addition to the LP's share. LPs receive the majority of every swap fee. The skim is not deducted from LP earnings; it is charged on top at the routing layer.
Protocol-owned liquidity deepens the pool to tighten spreads but is never withdrawn to defend a price.
6. Treasury Policy
The treasury is fully visible on-chain. Its mandate is growth and operations — never price defense. Revenue comes from the protocol skim on swap fees.
The treasury split is: 50% protocol-owned liquidity reinvestment (deepens the pool, never withdrawn to defend price) and 50% operations (oracle, audits, infrastructure, and development).
- Seed and deepen liquidity — protocol-owned liquidity for tighter spreads, funded by the 50% POL split, grows automatically with trading volume.
- Fund the oracle — pays for multi-source jackpot verification published on-chain, funded by the 50% operations split.
- Cover operations — audits, infrastructure, and development, funded by the protocol skim, not by selling tokens.
Treasury reserves create no claim on the protocol and are not a redemption backstop.
7. Reset Mechanics & Whale Exit
A reset is detected when the oracle reports a jackpot that drops sharply (below 50% of the last known value), indicating a winner. The reference value falls back to its base and a new cycle begins. The market reprices on its own — there is no cooldown gating trades, because there is nothing for the protocol to pause.
Whale exit: because exits are AMM swaps, a large holder selling moves the price down the curve and pays slippage proportional to their size relative to pool depth. No single participant can drain a treasury or jump a redemption queue; the pool simply reprices. This is the core safety property of removing redemption.
8. Attack Surface & Security
- Oracle manipulation — mitigated by multi-source consensus and sanity bounds; a single bad source cannot publish.
- Reference vs. market confusion — the UI never presents the oracle as a tradable price.
- AMM / liquidity risk — thin pools allow price impact; protocol-owned liquidity reduces but cannot eliminate it.
- Standard smart-contract risk — professional audit and timelocked, multi-sig admin required before mainnet.
9. Legal Positioning
MOON is a free-floating digital asset, not a lottery ticket, deposit, or redeemable instrument. The oracle reports public information only; the protocol makes no promise of value, return, or buy-back. Nothing here is financial advice. Participants should only commit funds they can afford to lose.
10. Token Allocation
MOON has a fixed total supply minted at genesis — no future inflation. The distribution is split between a liquidity pool seed (immediately deployed as DEX liquidity), team and advisor allocations (subject to a cliff and linear on-chain vesting unlock), and a community and ecosystem reserve. All vesting is enforced on-chain and verifiable on the Base block explorer.
On-chain vesting: team and advisor allocations are locked in a MoonVestingWallet contract enforcing a cliff and linear unlock schedule. Anyone can verify the locked balance on-chain via the Base block explorer.
Fee Flow
Swap fee → LP share (majority) + protocol skim (minority) → treasury → 50% POL reinvestment / 50% operations. The LP share compensates liquidity providers for impermanent loss exposure. The protocol skim funds the oracle, audits, infrastructure, and POL growth.
Fee Glide Path
The pool launches at a 1% fee tier to compensate LPs for elevated reset-event impermanent loss. As pool depth grows, governance can step the fee tier down: deeper pool → lower fee → more volume → more protocol-owned liquidity. Each tier step is triggered by TVL milestones.
11. Pool Size Calculator
The pool size calculator helps estimate how much liquidity should be seeded in the MOON/USDC pool at launch. Given an expected daily trading volume and a target maximum price impact per trade, it calculates the required USDC seed, the corresponding MOON seed at the oracle's risk-adjusted launch price, and the total pool TVL needed to keep price impact within bounds.
The launch price anchor is the oracle's risk-adjusted value for the current jackpot, which sets the initial MOON/USDC seed ratio. All calculations are shown live on the Technical Paper page using the current oracle reference.