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Fee Burn Module

The Fee Burn module implements a deflationary mechanism by permanently burning 50% of all transaction fees.

Overview​

┌─────────────────────────────────────────────────────────────┐
│                    Fee Distribution                          │
│                                                             │
│  Transaction Fee: 1000 RP1                                  │
│           │                                                 │
│           ├──────────────────────────────────────┐         │
│           │                                      │         │
│           ▼                                      ▼         │
│  ┌─────────────────┐              ┌─────────────────┐      │
│  │    50% Burned   │              │  50% Distributed│      │
│  │   500 RP1       │              │   500 RP1       │      │
│  │   (Permanent)   │              │                 │      │
│  └────────┬────────┘              └────────┬────────┘      │
│           │                                │               │
│           ▼                                ▼               │
│  Supply Reduced                  Validators & Stakers      │
│  Deflationary                    Block Rewards             │
│                                                            │
└─────────────────────────────────────────────────────────────┘

Burn Mechanics​

Every transaction on RP1:

  1. User pays transaction fee
  2. Fee collected by network
  3. 50% permanently burned (sent to burn address)
  4. 50% distributed to validators/stakers

Burn Address​

rp1000000000000000000000000000000000000burn

Tokens sent here are permanently removed from circulation.

Query Statistics​

Total Burned​

rp1d query feeburn total-burned

Output:

{
  "total_burned": "1234567890000urp1",
  "burn_rate": "0.50",
  "last_block_burned": "500000urp1"
}

Burn History​

rp1d query feeburn history --limit 100

Supply Statistics​

rp1d query feeburn supply-stats

Output:

{
  "initial_supply": "1000000000000000urp1",
  "current_supply": "998765432100000urp1",
  "total_burned": "1234567900000urp1",
  "burn_percentage": "0.123%"
}

TypeScript SDK​

import { FeeBurnModule } from '@rp1/sdk';

const feeburn = new FeeBurnModule(client);

// Get total burned
const stats = await feeburn.getTotalBurned();
console.log(`Total Burned: ${stats.totalBurned} RP1`);

// Get supply stats
const supply = await feeburn.getSupplyStats();
console.log(`Initial Supply: ${supply.initial}`);
console.log(`Current Supply: ${supply.current}`);
console.log(`Burn Rate: ${supply.burnPercentage}%`);

// Get burn history
const history = await feeburn.getBurnHistory({ limit: 10 });
history.forEach(h => {
  console.log(`Block ${h.height}: ${h.burned} RP1 burned`);
});

Impact Calculator​

Calculate the deflationary impact:

// Estimate yearly burn based on current volume
const dailyTxs = 1000000;
const avgFee = 1000; // urp1
const burnRate = 0.5;

const dailyBurn = dailyTxs * avgFee * burnRate;
const yearlyBurn = dailyBurn * 365;
const yearlyBurnPercent = yearlyBurn / totalSupply * 100;

console.log(`Estimated yearly burn: ${yearlyBurn} urp1 (${yearlyBurnPercent}%)`);

Governance​

The burn percentage can be adjusted via governance:

# Submit proposal to change burn rate
rp1d tx gov submit-proposal param-change burn-proposal.json \
  --from validator

Example burn-proposal.json:

{
  "title": "Adjust Burn Rate",
  "description": "Increase burn rate from 50% to 60%",
  "changes": [
    {
      "subspace": "feeburn",
      "key": "BurnPercentage",
      "value": "0.60"
    }
  ],
  "deposit": "1000000urp1"
}

Parameters​

ParameterDefaultDescription
burn_percentage0.50Percentage of fees burned
burn_enabledtrueEnable/disable burning
min_burn_amount1Minimum amount to trigger burn

Events​

EventTypeBurn = "fee_burn"
AttributeKeyAmount = "amount"
AttributeKeyTotalBurned = "total_burned"
AttributeKeyBlockHeight = "height"

Economic Impact​

Supply Reduction Over Time​

YearEstimated BurnSupply Reduction
150M RP15%
245M RP19.5%
340M RP113.5%
535M RP120%

Estimates based on projected transaction volume

Comparison with Other Mechanisms​

ProtocolMechanismRate
RP1Fee Burn50% of fees
Ethereum (EIP-1559)Base Fee BurnVariable
BNBQuarterly BurnUntil 100M
LUNA (Classic)Mint/BurnVariable

Implementation​

// BeginBlocker burns accumulated fees
func (k Keeper) BeginBlocker(ctx sdk.Context) {
    // Get accumulated fees
    fees := k.bankKeeper.GetAllBalances(ctx, k.feeCollectorAddr)

    // Calculate burn amount
    burnAmount := fees.MulInt(k.GetBurnPercentage(ctx))

    // Burn tokens
    if err := k.bankKeeper.BurnCoins(ctx, types.ModuleName, burnAmount); err != nil {
        k.Logger(ctx).Error("failed to burn fees", "error", err)
        return
    }

    // Update statistics
    k.AddToBurnTotal(ctx, burnAmount)

    // Emit event
    ctx.EventManager().EmitEvent(
        sdk.NewEvent(
            types.EventTypeBurn,
            sdk.NewAttribute(types.AttributeKeyAmount, burnAmount.String()),
        ),
    )
}

Next Steps​