# Sustainable Economy

### Economic Model

### Sinks 

**Primary: Gear repairs**

```
S_repair = N_raids × N_gear × D_loss × C_repair
```

* N\_raids: daily raids (scales with Soul supply)
* N\_raids = total player raid participations per day (not parties)
* N\_gear: equipped items (\~4-6)
* D\_loss: 1 durability per raid
* C\_repair: cost per point (dynamic)

**Secondary:**

* Stat rerolls 
* Raid tickets (50% of raids)
* Gear merging (burn 5→1 higher rarity, requires full durability)

### Faucets 

**Primary: Boss damage payouts**

```
P_dmg = N_raids × F_boss × W_dmg
```

* F\_boss: 0.33 (boss spawn rate)
* W\_dmg: average boss payout (dynamic)
* Distributed to players proportional to damage dealt (per boss encounter).

**Secondary:**

* NFT drops (asset rewards)
* Tournament prizes (capped)
* Referral bonuses (per successful invite)

#### Sustainability Target

**Coverage Ratio:**

```
CR = Σ Sinks / Σ Faucets ≥ 1.2
```

When CR > 1, the economy generates more revenue from gameplay than it distributes in rewards. This is the opposite of traditional GameFi, where unlimited rewards exceed revenue, creating Ponzi dynamics.<br>

#### Gear Issuance & Supply Control

**Source of supply**

* **No direct mint.** Gear enters the economy **only** via PvE drops (mob/boss) and special event rewards.
* **Public odds.** Drop tables and rates are published per season; no lootboxes.

**Rarity ladder & burns**

* T1 → T5 rarity. **Merge 5→1** to upgrade (burns 5 items at full durability).
* Salvage at 0 durability optionally burns the item for small mats (extra sink).

**Durability as a baseline sink**

* Each raid consumes **1 durability** per equipped item.
* Repairs require on-chain payment; **C\_repair** is dynamically tuned to maintain target CR.

**Drop policy (seasonal budget)**

* Mob encounters: **p\_mob** drop chance (lower value, higher freq).
* Boss encounters: **p\_boss** drop chance (higher value, lower freq).
* Daily/weekly **drop budgets** cap total new gear; unused budget rolls forward.

**Supply equation (per epoch)**

* ΔSupplyt=Dropst−Burnst (merge+salvage)\Delta Supply\_t = Drops\_t - Burns\_t\\,(merge{+}salvage)ΔSupplyt​=Dropst​−Burnst​(merge+salvage)
* Target steady state: **Drops\_t ≈ Burns\_t**; deviations corrected by p\_mob/p\_boss and C\_repair.

**Control levers (to keep CR ≥ 1.2)**

* Tune **C\_repair**, **p\_mob/p\_boss**, and merge recipes.
* Seasonal rotations (new sets) → old sets shift to **legacy** (reduced drop, higher merge value).

**Market hygiene**

* No inflationary faucets tied to volume.
* Secondary royalties capped; sinks (repairs, merges) scale with active play, not hype.

**Why this is sustainable**

* Players **earn gear by playing**, not by emissions.
* **Repairs + merges** continually remove supply while rewarding engagement.
* Designers keep **coverage ratio (CR)** above target by adjusting **three dials**: drop rates, repair costs, and merge intensity.


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