$NUMA Token

rETH-backed utility token

$NUMA is the utility token for the numa protocol. There should be no expectation of financial gain from the $NUMA token. $NUMA is not meant to be a speculative vehicle; instead, it serves as collateral for the numa protocol, backed by rETH (Rocket Pool ETH).

The collateral for the protocol is held in rETH in the numa vault. One of the utilities of the $NUMA token is that its value perpetually accrues versus the value of the rETH vault, minus the outstanding synthetic assets. This ensures that the $NUMA token and its synthetic derivatives are always over-collateralized by the rETH vault.

$NUMA tokens are created by depositing rETH into the vault and receiving $NUMA in return. The nominal price of $NUMA tokens is calcuated as (rETH_$value-numoney_$value)/(numaTokensCirculating). The mint price and burn price of $NUMA are the nominal price plus fees. Users can also purchase $NUMA on the open market, so the value is determined by the demand for the synthetics minted via the protocol. And as liquidity grows, regular users will more likely purchase tokens via the LP.

Users burn $NUMA tokens in order to mint nuMoney, such as $nuUSD or $nuBTC. The value is transferred 1:1 or dollar-for-dollar. For example, if a user wants to mint $500 worth of $nuUSD, they will burn $500 worth of $NUMA token.

The supply is elastic, which allows for tokens in circulation to increase or decrease, based on the burn and mint mechanism. To exit $NUMA positions, users can either sell their tokens into an LP or they can burn their tokens and remove rETH from the vault.