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Key Concepts

Understanding these core concepts will help you grasp how FEY Protocol creates a self-sustaining, user-owned launchpad network.

Permissionless Ownership

Traditional launchpads are permissioned - the company controls fee distribution, can change revenue sharing, and owns all decision-making power. FEY is permissionless - all core operations happen automatically through smart contracts without any central control.

Fee Distribution Model

How Fees Flow

Automatic Distribution

  • LP Fees: Standard Uniswap V4 fees go to liquidity providers (80%)
  • Protocol Fees: 20% of LP fees automatically route to the protocol
  • Collection: Fees collected in the paired token (FEY or WETH)
  • Distribution: 100% flows back to stakers through permissionless contracts

TOKEN/FEY Pairing Model

Why FEY Pairs?

All tokens deployed on FEY pair with $FEY rather than ETH or stablecoins. This creates:

  • Buy Pressure: Every trade creates demand for $FEY
  • Network Effects: As more tokens launch, $FEY becomes more valuable
  • Creator Alignment: Token creators earn rewards in $FEY, aligning them with protocol success

Bootstrap Exception

The $FEY token itself pairs with WETH to provide the base liquidity for the entire system. This WETH/FEY pool is the only exception to the FEY-pairing rule.

Staking & Reward Mechanics

Staking Benefits

When you stake $FEY, you receive:

  • Protocol Fees: From all trading activity across the network
  • LP Rewards: From liquidity positions managed by the protocol
  • Buyback Distribution: From automatic WETH→FEY conversions

Early Participant Advantage

Since staking rewards are distributed proportionally, early stakers receive higher relative rewards because:

  • Fewer total stakers = larger share of fees
  • Growing network activity = increasing absolute rewards
  • Fixed token supply = no dilution from new issuance

Creator Rewards System

How Creators Earn

Token creators receive rewards through multiple mechanisms:

  1. Direct Creator Fees: 1% of trading volume in their token
  2. LP Position Rewards: Fees from protocol-managed liquidity positions
  3. Network Participation: All rewards paid in $FEY, giving creators exposure to network growth

Success Alignment

This model aligns creator success with network success:

  • Successful tokens generate more trading volume
  • More volume = more $FEY rewards for creators
  • Creators become $FEY stakeholders, incentivized to promote the network

Automatic Buyback Mechanism

WETH → FEY Conversion

The protocol implements automatic buybacks:

  1. WETH Accumulation: Factory receives WETH fees from FEY/WETH pool
  2. Public Triggers: Anyone can call claimWethFees() to release accumulated WETH
  3. Manual Buyback: WETH goes to teamFeeRecipient who performs market buyback
  4. Distribution: Purchased $FEY flows to staking contract for distribution

MEV Protection

Fair Launch Protection

New token pools receive MEV protection during launch:

  • Time Window: 2-minute maximum protection period
  • Fee Adjustment: MEV module can increase fees up to 80% to deter MEV
  • Auto-Disable: Protection automatically expires or can be disabled by the module
  • Liquidity Block: No liquidity changes allowed during protection window

No-Op Default

The current MEV module is a "no-op" that immediately disables itself, serving as a template for future MEV protection implementations.

Extension System

Modular Functionality

FEY uses an extension system to add functionality:

  • Dev Buy Extensions: Allow ETH purchases during token deployment
  • Future Extensions: Airdrops, vesting, presales, etc.
  • Permissioned Extensions: Must be approved through allowlist contract
  • Composable: Multiple extensions can be used in single deployment

Current Extensions

FeyUniv4EthDevBuy (0x173077c319c38bb08D4C4968014357fd518446b4)

  • Enables ETH-based token purchases during deployment
  • Automatically swaps ETH → WETH → FEY → new token
  • Pure buy mechanism (no token allocation to extension)

Network Economics

Fixed Supply Model

  • Total Supply: 100,000,000,000 $FEY (100B tokens)
  • No Inflation: Fixed supply, no new issuance
  • Deflationary Pressure: Automatic buybacks reduce circulating supply
  • Value Accrual: All network growth benefits existing holders

Self-Sustaining Loop

  1. More tokens deploy on FEY → More trading volume
  2. More volume → More protocol fees → More rewards for stakers
  3. Higher staking rewards → More demand for $FEY
  4. Higher $FEY price → Better creator rewards → Attracts more creators
  5. Loop repeats, creating network effects

Next Steps

Now that you understand the key concepts: