The Quanto Flywheel

The QTO token is the core asset driving value across the Quanto ecosystem. Its design creates a reflexive flywheel of utility, burn, and buy pressure that rewards long-term holders.

Trading Activity & Value Flows

Users trade and settle PnL in QTO: All trades, and thus profits and losses across the platform are denominated in QTO.

Fee structure:

• All trading fees are paid in $QTO.

• Of these fees:

  • 70% is permanently burned, reducing circulating supply.

  • 30% is distributed to QTO stakers, rewarding long-term holders.

• Read more on Fees here.

Liquidation Mechanics & Buybacks

Non-QTO Collateral Liquidations:

• When a user is liquidated on collateral not denominated in QTO (e.g., SOL, BTC, meme coins), that collateral is sold on the open market to buy back $QTO.

• This converts all realized losses into buy pressure for QTO, directly benefiting holders.

• Read more on Buybacks here.

Partial Liquidation & Loss Realization:

• If a user is not fully liquidated, but realizes losses on their non-QTO collateral (e.g., via devaluation or trade closure), those unrealized losses are converted into QTO-denominated debt.

• Users must repay this debt in $QTO, further reinforcing demand.

• Read more on Liquidations here.

Holder Incentives

Deflationary Supply:

• Continuous burn from fees reduces token supply over time, increasing scarcity.

Buy Pressure from External Assets:

• Every non-QTO collateral loss event (e.g., liquidations, drawdowns) contributes to QTO buybacks.

Staking Rewards:

• 30% of platform fees are distributed to stakers, incentivizing long-term alignment.

Liquidation Cascade Scenario

In the event of a liquidation cascade, where many users are liquidated simultaneously:

• A large volume of non-QTO collateral is sold on the open market.

• These sales are routed to buy back $QTO in real-time, creating extreme buy pressure.

• This mechanism helps:

  • Absorb market volatility.

  • Protect the protocol from systemic risk.

  • Transfer value from overleveraged positions back to $QTO holders.