How Solpot Works

Solpot operates at a 5% tax utilizing Solana's Transfer Fee token extension. This tax is designed to sustain the ecosystem and provide ongoing incentives for holders through a structured prize pool mechanism.

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1. Fee Collection

Every SOLPOT transfer automatically incurs a 5% tax through the Token-2022 program. These collected fees are periodically harvested and allocated as follows:

• 100% of the total tax is allocated to a prize pool, which will be used for periodic lottery-based rewards. Holders who meet the eligibility criteria will have a chance to participate and win a portion of the prize pool.

• 30% of the prize pool (which is derived from the 100% allocation) is further distributed to the holder rewards system. This system ensures that multiple winners receive a share of the pool rather than a single individual taking the full amount. The goal is to incentivize continued holding and participation in the ecosystem.

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2. Market Operations

A portion of the tax is allocated for market operations, ensuring the stability and sustainability of the token. This portion is:

• Automatically converted into SOL through Jupiter, a decentralized exchange aggregator.

• The resulting SOL is then utilized to support buyback operations, reinforcing the token's liquidity and helping to sustain its market value over time.

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3. Holder Rewards and Lottery System

The reward system is structured around a lottery-based prize distribution model. Instead of traditional staking or automatic redistribution, SolPot uses a provably fair lottery system where eligible holders stand a chance to win from the prize pool. The system is designed to:

• Provide ongoing incentives for holding by allowing users to participate in periodic prize draws.

• Distribute rewards among multiple winners, ensuring fairness and inclusivity.

• Encourage engagement by making participation easy and transparent.

The exact mechanics of the lottery, including eligibility criteria, draw frequency, and additional perks, will be detailed further as the ecosystem develops. By focusing on a sustainable rewards system, SolPot aims to create a thriving and engaged community where long-term holders are continually incentivized.