How does the Skyward Treasury work?

Example of sale #1: $SKYWARD Sales
Let’s use the 25% $SKYWARD sale as an example. Imagine there was 1 Million NEAR added; thus, 1 million NEAR is a demand and 250,000 $SKYWARD is a supply. For simplicity, we will keep the demand fixed in this example.
Once sale is over, and 250,000 $SKYWARD is sold for 1,000,000 $NEAR, all 1,000,000 NEAR is being deposited to the treasury. This means that every 1 $SKYWARD token is backed by 4 $NEAR tokens after the sale.
What can you do with it?
Now you have 2 options:
- Add $SKYWARD to Ref Finance and expect a higher price due to expected increased size of the treasury in the future (since every sale on Skyward Finance has a 1% fee on the token that is being sold and 1% on a token that’s being to purchase offered token). Thus, Skyward Treasury will continuously increase.
- Redeem $SKYWARD. If you redeem 1 $SKYWARD, you receive 4 $NEAR from the Skyward Treasury and the 1 $SKYWARD is burned (removing it from the circulation forever). This operation doesn’t affect the rate of $SKYWARD.
Example of sale #2: MOON (non-$SKYWARD sale)
Someone wants to sell 500,000 $MOON tokens for $nUSDT. Let’s imagine that there were 2,000,000 $nUSDT deposited (for simplicity, let’s keep it fixed).
This means that 5,000 $MOON (1% from 500,000 $MOON) tokens and 20,000 $nUSDT (1% of 2,000,000 $nUSDT) were added to the Skyward Treasury. So right now Skyward Treasury has:
- 1,000,000 $NEAR
- 20,000 $nUSDT
- 5,000 $MOON
This means that the incremental value of 1 $SKYWARD token increased by 0.08 $nUSDT (20,000 $nUSDT / 250,000 $SKYWARD) and by 0.02 $MOON (5,000 $MOON / 250,000 $SKYWARD).
Thus, all non-$SKYWARD sales after 25% sale #1 of $SKYWARD are going to accumulate value until the $SKYWARD sale #2.
What happens at $SKYWARD sale #2?
At this stage, we anticipate that $SKYWARD will be traded on Ref Finance. Since Skyward Finance platform does not have an ability to set the price, it means that sale #2 can potentially create arbitrage opportunities.
Example 1: The expected rate of $SKYWARD on the sale #2 is lower than the price from the sale #1 - thus, it’s an arbitrage opportunity. You can enter the sale #2 and receive cheaper $SKYWARD (than the first sale) and then redeem the $SKYWARD token to Treasury or sell $SKYWARD on Ref to receive an additional value. Skyward Treasury is tied to a Circulating supply; thus, in this scenario, all participants of the first sale are being diluted, while new entrants can receive an instant profit.
In this case, the $SKYWARD can be either redeemed from the Treasury or traded on Ref Finance. Redeeming $SKYWARD gives you a nominal value that’s backed by Skyward Treasury. Ref Finance in theory should have a different value attached to $SKYWARD that will be based on the future expectations for the size of the Skyward Treasury and Circulating Supply.
Example #2: The expected rate of $SKYWARD on the sale #2 is higher than the price from the sale #1. In this scenario, existing holders of $SKYWARD will benefit from the sale #2, because the Treasury backed price will be increased.
Do people who entered the sale earlier get a better price?
Prior to the sale, the rate history is displayed for the informational purposes only. Everyone will get the same rate once the sale starts, but different amount of $SKYWARD based on their amount of $NEAR.

More questions? https://skyward.finance/faq/