NFT/NXPC Exchange Rate

$$NFT/NXPC\ Exchange\ Rate_t = \frac{Number\ of\ NFTs\ in\ Item\ Pool_t}{Total\ Supply\ of\ NXPC_t}$$

The NFT/NXPC Exchange Rateₜ represents the number of NFTs that can be exchanged for one NXPC token at a specific time, t. Below are the variables used in this calculation.

• t: This indicates a specific point in time

• Number of NFTs in Item Pool_t: This represents the total number of items available in Item Pool at time, t.

• Total Supply of NXPC_t: This represents the the maximum supply cap (1B) minus the cumulative net amount of NXPC redeemed for NFTs at time t. Cumulative net amount of NXPC redeemed for NFTs equals the cumulative amount of NXPC removed from circulation via NXPC Fission minus the amount that has re-entered circulation through Item Fusion. (For additional information on Item Fusion, please refer to Section Item Fusion)

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When users exchange NXPC for NFTs, both the numerator (Number of NFTs in Item Poolₜ) and the denominator (Total Supply of NXPCₜ) changes proportionally. Thus, the NFT/NXPC Exchange Rateₜ remains unchanged when NXPC are exchanged for NFTs.

For example, suppose there are 100 NFTs in the Item Pool with a total NXPC supply of 10 at time t, resulting in the NFT/NXPC Exchange Rateₜ of 10 (100 ÷ 10 = 10; meaning 1 NXPC can be exchanged for 10 NFTs). If a set contains 10 NFTs and a user conducts NXPC Fission for one set (redeeming 1 NXPC for 10 NFTs), the Number of NFTs in Item Pool_t decreases to 90 NFTs, and the Total Supply of NXPC_t reduces to 9 tokens, maintaining the NFT/NXPC Exchange Rateₜ of 10 (90 ÷ 9 = 10).

Reversing this scenario, when a user exchanges a collection of 10 NFTs back into 1 NXPC through Item Fusion, the NFT/NXPC Exchange Rateₜ remains unchanged. The Number of NFTs in Item Pool_t increases back to 100, and the Total Supply of NXPC_t returns to 10, keeping the NFT/NXPC Exchange Rateₜ at 10 (100 ÷ 10 = 10).

However, when new items are introduced to the Item Pool, the NFT/NXPC Exchange Rateₜ increases because only the numerator (Number of NFTs in Item Poolₜ) increases, while the denominator (Total Supply of NXPCₜ) remains unchanged. Continuing the previous example, if 100 new items are introduced to the Item Pool, the Number of NFTs in Item Pool_t rises to 200, and the Total Supply of NXPC_t remains at 10, changing the NFT/NXPC Exchange Rateₜ to 20 (200 ÷ 10 = 20). This allows users to exchange more NFTs for the same amount of NXPC in subsequent timeframe, causing the NFT/NXPC Exchange Rateₜ to increase progressively with each new item introduction.

NFTs exist only in natural number quantities. The amount of NXPC required to exchange for a collection containing a specific number of NFTs is calculated using the NFT/NXPC Exchange Rateₜ. For example, exchanging 250 NFTs would require 12.5 NXPC (250 NFTs ÷ NFT/NXPC Exchange Rateₜ 20).

The protocol truncates the NFT/NXPC Exchange Rateₜ calculation to 18 decimal places. Due to this truncation, the actual exchange rate applied by the protocol might differ slightly from the theoretical rate calculated by the formula.