Strengthening the $LLAMA Token: Launching the «Reserve» Mechanism for Sustainable Growth

At LLAMA AMA 2025, we introduced a new deflationary mechanism called «Reserve», which we'll explain in more detail below

What is the mechanism about?

The «Reserve» mechanism is a deflationary algorithm that:

- Buys back tokens: A portion of the protocol's profits is used for regular token buybacks from the market.

- Forms a reserve: 50% of the purchased tokens are permanently moved to a protected reserve, reducing the total supply.

Why is this important?

- Deflationary effect: Accumulating the reserve limits token supply, increasing its value.

- Supply reduction: Removing tokens from circulation reduces selling pressure, contributing to price growth.

Example of how the mechanism works

Let's say we buy back 100,000 $LLAMA tokens:
1. 50,000 tokens are locked in the reserve.
2. 50,000 tokens go to the $LLAMA staking rewards pool on JVault

This leads to an immediate reduction in supply by 50,000 tokens and creates potential for future growth

The «Reserve» mechanism is just the beginning, laying a solid foundation for $LLAMA's growth. Stay tuned for updates in our DAOLama Channel 😉

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