Burning TBTs (FlashBurn)

Redeeming TBTs for value

When a user burns their TBT tokens, they can withdraw yield from a Yield Pool. Some TVS also have a Boost Pool that provides extra yield on top of the Yield Pool yield.

The information provided in this article pertains exclusively to strategies developed by the Flashstake DAO. The process of burning TBTs may vary for strategies developed by external parties.

The assets received upon burning TBTs are proportional to the user’s relative ownership of the total TBT supply for that specific strategy and the size of the yield pool. For example, if a user holds 45% of the total TBT supply for a given strategy, they could choose to burn all of those TBTs and redeem 45% of the value within that strategy’s yield pool.

Burning Math Example

For demonstration purposes, consider a scenario where the AAVE strategy has 400,000 USDC in its associated yield pool and 10,000 TBTs in existence. If you decide to Flashstake 30,000 USDC for 365 days, approximately 30,000 TBTs will be minted, making the total number of TBTs for this AAVE USDC strategy to now be 40,000. Your 30,000 TBTs represent 75% ownership of the yield pool, so if you burn all of your TBTs you can redeem approximately 300,000 USDC.

The numbers presented in this example are for illustrative purposes only and should not be treated as actual values or guarantees. Additionally, it is important to note that the TBT minting formula varies depending on the strategy in question. Strategies developed by the Flashstake DAO utilize the formula specified in the TBTs section of the documentation.

To burn TBTs, a user can call the “burnFToken” function in the associated strategy. Alternatively, this process can also be accomplished in a single transaction using the Flashstake feature which executes a mint and burn in the same transaction.

Calculating Burn APR

Yield is typically calculated as a percentage of the employed capital and can be represented as Annual Percentage Rate (APR) or Annual Percentage Yield (APY). The formula for calculating the upfront APR is as follows:

$$APR_{upfront} = \frac{Return_{upfront} * 31,536,000}{Deposit * StakeDuration_{(seconds)}}$$