Introduction
Gavel is an on-chain token distribution and liquidity bootstrapping platform on Solana.
Today, teams issuing tokens are forced to wade through an extractive and opaque labyrinth of centralized exchanges and market makers, or launch on-chain while giving up value to snipers and toxic MEV.
Users participating in the token economy face toxic MEV that lowers the quality of their fills, and an asymmetric information environment where undisclosed insider side deals abound.
Gavel provides:
Fair, transparent, and efficient ways to raise capital and distribute tokens, fully on-chain
On-chain liquidity that is safe for users to interact with and easy to manage
Full transparency and auditability throughout the lifecycle of the token
How it Works
A token launch on Gavel takes place in two phases.
First, there is an initial token distribution period where users deposit SOL and receive a token allocation at the end of the period.
Teams using Gavel can choose how much of their token to allocate to the sale, as well as from a variety of fair distribution mechanisms (e.g. Dutch auction, fixed price FCFS, permissioned, etc.).
When the initial distribution period is over, part of the token supply and part of the capital collected is deposited into Gavel's sandwich-resistant AMM.
The sandwich-resistant AMM is ideal for bootstrapping liquidity and facilitating early price discovery, while protecting swappers from frontrunning attacks.
Once a token is well-established, it can graduate to more efficient on-chain liquidity sources, such as Phoenix or SolFi, or to off-chain liquidity sources, such as centralized exchanges.
The launch process is involved and requires careful selection of parameters based on the goals of the team. Today, launching on Gavel is permissioned, though participation on the platform is permissionless and fully governed by on-chain smart contracts. Teams interested in using Gavel for token distribution and liquidity bootstrapping should reach out on X.
$IBRL
$IBRL is a test token that exists solely to demonstrate the Gavel protocol in production.
The token has no present or future utility.
100% of the funds collected and 100% of the token supply are allocated to the Gavel mechanism, as described below.
Public Sale
Of the total 1,000,000,000 $IBRL token supply, 700,000,000 is distributed through a 24-hour public sale. The sale is a period where users can deposit SOL; at the end of the period, the public sale allocation is fully distributed in proportion to each user's deposit.
3/7 of the SOL collected is paired with the remaining 300,000,000 $IBRL as initial liquidity in the sandwich-resistant AMM, so that the opening price on the AMM equals the clearing price of the public sale.
AMM
The remaining 4/7 of the SOL collected is allocated to directly purchase the token from the AMM, on a schedule with exponential decay. 0.01% of the remaining SOL is used to buy the token every 1000 slots (~6.5 minutes), which is immediately burned.
The liquidity on the AMM also decreases on a schedule with exponential decay. Beginning 7 days after the public sale, 0.01% of the liquidity is withdrawn every 2000 slots (~13 min), up to 20,000 times in total. The SOL is immediately used to directly buy $IBRL, and the $IBRL is burned.
Both of these processes are governed autonomously by on-chain smart contracts, with a permissionless crank.
None of the $IBRL token supply nor the SOL collected are retained by the team.
Fees
There are no fees on the initial token distribution. Gavel takes a 30 basis point fee on swaps through the AMM.