Favor Tokens

Favor is BetterBank’s synthetic credit token, designed to replace the void of assets in traditional fractional reserve banking with a fully on-chain, decentralized credit system. Unlike conventional fiat-backed systems that rely on trust in centralized institutions, Favor’s value is algorithmically regulated and dynamically adjusted based on real market conditions.

How Favor Works

• Acts as synthetic collateral for borrowing assets in the Wildlands.

  • For purposes of calculating Favor as a collateral asset, Favor types are limited to 3.5x their paired asset, even though there is no actual price ceiling. This limit helps safeguard the lending markets against price volatility and potential exploits.

• Liquidity-Backed Stability – Favor tokens are paired with their respective assets (e.g. pDAI to DAIF, and USDTF to USDT) to maintain deep liquidity and price alignment.

• Dynamic Seigniorage Model – The supply of Favor expands rapidly or slowly based on demand, preventing instability and runaway inflation.

  • Favor tokens are soft pegged to their respective asset and do not stop emissions based on being under peg like earlier seigniorage models did. Rather, emissions just slow or increase printing based on the Favor price relative to the paired asset.

Favor’s Role in the BetterBank Ecosystem

• The backbone of Wildlands lending, acting as credit in the form of collateralized LP positions.

• Self-sustaining and demand-driven, preventing the failures of past algorithmic seigniorage tokens.

• Supports deep, liquid DeFi markets while ensuring long-term capital efficiency.

Favor isn’t just another synthetic token—it’s the key to unlocking capital efficiency and credit expansion in DeFi. 🚀