Use Cases

A governance & reward token

VCRAFT, the governance token of BitVault, offers several compelling use cases that benefit token holders and contribute to the protocol's growth and stability.

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Protocol Governance

VCRAFT holders have the power to participate in BitVault's governance process. They can propose and vote on important protocol decisions, including:

• Adjustments to protocol parameters

• Addition of new collateral types

• Changes to fee structures

• Allocation of protocol revenue

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Revenue Sharing through Buybacks

A significant portion of BitVault's protocol revenue is used to buy back VCRAFT tokens from the open market. This mechanism provides several benefits to VCRAFT holders:

• Increased token value: Buybacks reduce the circulating supply of VCRAFT, potentially increasing its price

• Passive income: Holders can sell their tokens during buybacks for profit

• Enhanced protocol stability: Buybacks help maintain a healthy token economy

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Liquidity Mining Incentives

To encourage liquidity provision for bvUSD and VCRAFT pairs:

• Liquidity providers can earn additional VCRAFT rewards

• This helps maintain deep liquidity for BitVault's ecosystem

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Collateral for Borrowing

While not the primary collateral type, VCRAFT may be used as additional collateral within the BitVault system in the future:

• Allows holders to leverage their VCRAFT holdings

• Potentially increases capital efficiency for users

By focusing on these use cases, VCRAFT serves as a crucial component of the BitVault ecosystem, aligning the interests of token holders with the protocol's success. The buyback mechanism, in particular, creates a strong value proposition for VCRAFT holders, as it directly ties the token's value to the protocol's performance and revenue generation.