# KSP TOKENOMICS

KSP is a reward given to ecosystem participants and serves as a strong incentive to secure more liquidity in the klay swap protocol. It provides meaningful liquidity-based transactions and more financial opportunities through token economy structures that enable efficient distribution and value maximization of limited KSP resources.‌​

### KSP mining quantity <a href="#ksp-1" id="ksp-1"></a>

‌

The total daily mining quantity of KSP is **86,400 KSP**, which is distributed excluding the developer commission for the first two years, and halving is applied every two years. Please refer to [KSP Allocation](https://docs.klayswap.com/tokenomics/ksp/ksp-allocation) for detailed mining plans.‌

| ​**​Items**                | **Quantities**                         |
| -------------------------- | -------------------------------------- |
| Distribution by block      | 1 KSP                                  |
| Developer commission (15%) | 0.15 KSP                               |
| KSP mining per day​        | 86,400 KSP                             |
| ​                          | \*\*\* Commission excluded: 73,440 KSP |

​‌

### KSP inflation distribution ratio <a href="#ksp-2" id="ksp-2"></a>

‌‌

KSP inflation is distributed to single, pair (existing/plus), and KSP stakers who are the key contributors to the KLAYswap ecosystem. Distribution ratios can be adjusted through governance voting.‌

**Initial (Pre-Halving)**

<table data-header-hidden><thead><tr><th width="246">Distribution target</th><th>Distribution ratio by block(%)</th><th>Distribution per block</th><th>Daily distribution (86,400 blocks)</th></tr></thead><tbody><tr><td><strong>Distribution target</strong></td><td><strong>Distribution ratio by block(%)</strong></td><td><strong>Distribution per block</strong></td><td><strong>Daily distribution (86,400 blocks)</strong></td></tr><tr><td>Single depositors</td><td><strong>5%</strong></td><td><strong>0.05 KSP</strong></td><td><strong>4,320 KSP</strong></td></tr><tr><td>Pair depositors(Existing, Plus)</td><td><strong>45%</strong></td><td><strong>0.45 KSP</strong></td><td><strong>38,880 KSP</strong></td></tr><tr><td>KSP staking</td><td><strong>50%</strong></td><td><strong>0.5 KSP</strong></td><td><strong>43,200 KSP</strong></td></tr><tr><td><strong>Total</strong></td><td><strong>100%</strong></td><td><strong>1KSP</strong></td><td><strong>86,400 KSP</strong></td></tr><tr><td>​</td><td><strong>* **Except commision</strong></td><td><strong>0.85 KSP</strong></td><td><strong>73,440 KSP</strong></td></tr></tbody></table>

**​**

**Currently (First Halving Applied)**

<table data-header-hidden><thead><tr><th width="246">Distribution target</th><th>Distribution ratio by block(%)</th><th>Distribution per block</th><th>Daily distribution (86,400 blocks)</th></tr></thead><tbody><tr><td><strong>Distribution target</strong></td><td><strong>Distribution ratio by block(%)</strong></td><td><strong>Distribution per block</strong></td><td><strong>Daily distribution (86,400 blocks)</strong></td></tr><tr><td>Single depositors</td><td><strong>3%</strong></td><td><strong>0.015 KSP</strong></td><td><strong>1,296 KSP</strong></td></tr><tr><td>Pair depositors(Existing, Plus)</td><td><strong>35%</strong></td><td><strong>0.175 KSP</strong></td><td><strong>16,120 KSP</strong></td></tr><tr><td>KSP staking</td><td><strong>62%</strong></td><td><strong>0.31 KSP</strong></td><td><strong>26,784 KSP</strong></td></tr><tr><td><strong>Total</strong></td><td><strong>100%</strong></td><td><strong>0.5KSP</strong></td><td><strong>43,200 KSP</strong></td></tr></tbody></table>

**​**‌

## &#x20;<a href="#ksp" id="ksp"></a>

## Value maximization through KSP deflation <a href="#ksp" id="ksp"></a>

The KLAYswap protocol has a flexible token economy structure that can maximize the value of KSP by controlling KSP distribution through a deflation model. This not only offers high level of APR for liquidity providers such as pool depositors and KSP stakers, but also builds a more robust and sustainable ecosystem where the scarcity value of KSP gradually increases as more users participate.‌

### The effect of reducing distribution through halving <a href="#undefined-1" id="undefined-1"></a>

The halving of each two-year cycle slows down KSP inflation by reducing the number of KSPs distributed per block. Please check for KSP Allocation for detailed inflation plans.

{% content-ref url="ksp-allocation" %}
[ksp-allocation](https://docs.klayswap.com/tokenomics/ksp/ksp-allocation)
{% endcontent-ref %}

### The effect of reducing distribution through Buyback & Burn <a href="#and" id="and"></a>

* KSP incineration using bi-back funds: 50% of transaction fees generated from all pools are raised as KSP buy-back funds and used for KSP incineration.&#x20;
* Incineration of KSP pool registration fee: A certain amount of KSP is used to create new pairs in KLAYswap, and the cost gets incinerated.