# Carbon Vortex 2.0 - Dutch Auction

**URL:** <https://gov.bancor.network/t/carbon-vortex-2-0-dutch-auction/4597>\
**Category:** DAO Archive (SUBMITTED)\
**Created:** [March 13, 2024, 8:18am UTC](https://gov.bancor.network/t/carbon-vortex-2-0-dutch-auction/4597 "2024-03-13T08:18:16Z")\
**Posts on this page:** 2\
**Page:** 1

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**Author:** ![foxsteven](https://avatars.discourse-cdn.com/v4/letter/f/838e76/32.png) [@foxsteven](https://gov.bancor.network/u/foxsteven)\
**Post date:** [March 13, 2024, 8:18am UTC](https://gov.bancor.network/t/carbon-vortex-2-0-dutch-auction/4597/1 "2024-03-13T08:18:16Z")

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# To be posted to Snapshot March 24, 2024

# TL;DR

- The Carbon Vortex has been part of CarbonDefi since launch
  - Link to proposal: [Proposing Carbon](https://gov.bancor.network/t/proposing-carbon-final/4242)
  - Link to docs: [CarbonVortex](https://docs.carbondefi.xyz/developer-guides/carbonvortex)
  - Link to most recent update: [FastLane](https://gov.bancor.network/t/proposal-carbon-vortex/4331)

- The current version is limited to only being able to sell tokens that have a B3 pool.
- As noted here ([FastLane](https://gov.bancor.network/t/proposal-carbon-vortex/4331)) “If this proposal passes, we should expect a second version that will also know how to handle tokens that do not have liquidity on Bancor 3.”
- This proposal is to allow the Vortex to function without reliance on B3.
- As you can see, there are many tokens which are held by the vortex but the mechanism to sell them does not yet exist: [Bancor: Carbon Fee burner | Address: 0xba7d1581...7703c8f84 | Etherscan](https://etherscan.io/address/0xba7d1581db6248dc9177466a328bf457703c8f84)
  - NOTE: This is designed in a generic fashion so that it can also be used by anyone licensing the Carbon source code.

# Background

The design for Vortex 2.0 is very similar to the POL contract ([link](https://gov.bancor.network/t/update-to-pol-migration-and-conversion-to-eth/4438)) ([link](https://gov.bancor.network/t/proposal-to-use-pol-to-reduce-b3-deficits/4502)). The goal is to take fees earned and convert them to BNT via ETH and send that BNT to the token contract.

# Description:

Parameters:

- Define target token: **ETH**
- Define final target token: **BNT**
- Define MaxSaleAmount: **100**
- Define MinSaleAmount: **10**
- Define Caller Incentive: **0.5%** (this represents a reduction from current incentives)
- Define Half Life: **12 hours**

Note: ETH is proposed as it is the most common pairing of tokens on Ethereum mainnet. This should ensure mostly simple trading pairs without the need for complex arb routes.

Flow:

Note: For simplicity, I will describe the flow using the above parameters

- The CarbonController and Carbon Vortex/Vault hold all fees generated from Carbon and the Arb Bot on Ethereum.
  - Note: In the future, I plan to propose a mechanism for sending TKN from the arb bot vaults on other chains to the Carbon Vortex.

- Users can call a public function to enable TKN to ETH trading
  - Withdraws accumulated fees (CarbonController + TKN in vortex/vault)
  - Caller gets 0.5% of TKN transferred amount (caller incentive)
  - TKN is put up for sale at an arbitrarily high price with exponential decay and half life of 12 hours.
  - To prevent abuse, calling this function will reset the auction price if over half of the TKN has been sold already
  - Users can call the public function to trade TKN for ETH at any time or price point.

- If BNT is defined as the final target token, ETH is put up for sale for BNT at an arbitrarily high price with exponential decay and half life of 12 hours.
  - Similar to the POL contract, this can be triggered with a bucket system ([LINK](https://gov.bancor.network/t/proposal-to-use-pol-to-reduce-b3-deficits/4502/5))
  - These are defined as MaxSaleAmount and MinSaleAmount

- BNT received is sent to the token contract.

# For:

Update to Vortex 2.0 as outlined above

# Against:

Take no action

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**Author:** ![glenn](https://dub1.discourse-cdn.com/flex013/user_avatar/gov.bancor.network/glenn/32/1720_2.png) [@glenn](https://gov.bancor.network/u/glenn)\
**Post date:** [March 13, 2024, 10:54pm UTC](https://gov.bancor.network/t/carbon-vortex-2-0-dutch-auction/4597/2 "2024-03-13T22:54:59Z")

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Looks good to me and much needed as we have over \>$100k that needs to be converted to BNT.