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.
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