> For the complete documentation index, see [llms.txt](https://taxifinance.gitbook.io/taxifinance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://taxifinance.gitbook.io/taxifinance/lps-yeild-farming/taxi.cash-mechanism.md).

# Taxi.cash Mechanism

Basis.cash is the best algorithm stablecoin protocol out there, We want to thank DeFiMorty and DeFiRick for their trailblazing work in Basis Cash.

Taxi.cash is a fork of Basis.cash, but build on BSC Chain, its just that simple.

## The Mechanism

The protocol consists of three tokens (Taxi Cash - **TAXIC**, Taxi Share - **TAXIS**, Taxi Bond - **TAXIB**), with Taxi Share and Taxi Bond designed to move Taxi Cash towards the price of $1. The following scenarios describe how Taxi Share and Taxi Bond work, with the first scenario assuming that the price of Taxi Cash is above $1 and below $1 in the second.

### When Taxi Cash(TAXIC) is below $1 <a href="#id-16a3" id="id-16a3"></a>

When TAXIC is traded below $1, users will be able to purchase TAXIB at a certain discount to establish the price stability of TAXIC, with the expectation of future profits upon redemption.

Each bond promises the holder exactly 1 TAXIC at some point in the future under certain conditions. Whenever a user purchases TAXIC, it is burned, causing **a decrease in the circulating cash supply**. Bonds do not have interest payouts, nor do they have maturity or expiration dates. Rather, they can be redeemed on a 1:1 ratio with TAXIC when the price rises above $1.

Purchased bonds can be redeemed on a 1:1 ratio with cash only when the oracle price of cash is above $1. This prevents bondholders from cutting their losses on redemptions and creating unnecessary increases in supply.

### **When Taxi Cash exceeds $1** <a href="#ffa5" id="ffa5"></a>

When the price of TAXIC exceeds $1, the contract primarily allows **bond redemptions** to bond redeemers. Even after the bonds are redeemed, if the price of TAXIC is traded above the price of $1, an increase in the demand of TAXIC results in new TAXIC tokens being minted and distributed to **TAXIS** holders.

For instance, let’s assume that the price of TAXIC exceeds $1 even after bond redemption. In this case, the Treasury contract mints new TAXIC seigniorage into existence. This seigniorage is given to the **Boardroom**, where users can stake TAXIS and earn daily seigniorage based on the price of TAXIC.

## Distribution Overview <a href="#e930" id="e930"></a>

### **Zero supply minted / purely via community distribution.** <a href="#id-7270" id="id-7270"></a>

The initial distribution of TAXIC prioritizes those who deposit **TAXI/BUSD Taxiswap Lp tokens**, BUSD, TAXIC, BAKE, CAKE to the distribution contract. **TAXI/BUSD Taxiswap LP tokens will have an x6 rewards in compared to other single staking pool.**&#x20;

A total of **50,000** TAXIC tokens are distributed to depositors, with 10,000 Cash tokens distributed per day. The distribution details:

* TAXI/BUSD: **6000 TAXIC tokens** per day.
* An equal amount of **1000 TAXIC tokens** is assigned to each pool in the list: **BUSD, TAXIC, BAKE, CAKE** per da&#x79;**.**

Afterward, TAXIS is distributed to those that provide liquidity to the **TAXIC-BUSD Taxiswap pair**, where users can deposit LP tokens to the distribution contract and earn TAXIS. The **TAXIS pool 1** will distribute 750,000 TAXIS, starting with 6250 TAXIS and decreases 75% after every 30 days.

A further amount of TAXIS is given to liquidity providers of the **TAXIS - BUSD Taxiswap pair,** distributing a total of 250,000 **TAXIS** which lasts for **1 year (365 days)**, and an equal amount of tokens is distributed per day.