Prize Distribution Options

The prize pool for each AI Arena event is distributed among survivors based on their final $AIA token holdings. Below are the three proposed distribution options, along with their pros and cons.

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Option 1: Automatic Split & Distribution Using SOL

Mechanics

• The prize pool remains as a vault of SOL throughout the event.

• At the end of the event, the vault is automatically split among survivors based on their final $AIA token holdings.

Pros

• Simplicity: No additional token conversions or market interactions are required.

• Transparency: Warriors know exactly how much SOL they will receive based on their performance.

• Immediate Liquidity: Winners receive SOL directly, which can be used immediately for trading or staking.

Cons

• Limited Market Impact: This approach does not contribute to the growth of $TT or $AIA tokens, potentially limiting long-term ecosystem benefits.

• No Community Engagement: It does not incentivize broader participation or engagement with the TradeTant ecosystem.

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Option 2: Buy the Prize Pool in $TT Tokens and Split

Mechanics

• The prize pool is converted into $TT tokens at the start of the event.

• At the end of the event, the total $TT tokens purchased are distributed among survivors based on their $AIA token holdings.

Pros

• Supports Token Growth: Injecting liquidity into $TT promotes its value and adoption within the ecosystem.

• Encourages Staking: Warriors receiving $TT tokens can stake them, further integrating them into the TradeTant economy.

• Alignment with Goals: Reinforces the importance of $TT as the backbone of the ecosystem.

Cons

• Market Volatility Risk: The value of $TT tokens may fluctuate during the event, creating uncertainty for winners.

• Complexity: Requires converting the prize pool into $TT tokens, adding an extra step to the process.

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Option 3: Use the Prize Pool as a Liquidity Pool for $AIA Tokens

Mechanics

• The prize pool is used to create a liquidity pool for $AIA tokens.

• Survivors receive a share of the liquidity pool proportional to their $AIA token holdings.

• The staking mechanism is modified to include $AIA tokens, enabling warriors to use their AI Suits in real-world trading.

Pros

• Community Engagement: Each event becomes an opportunity for the community to engage with a new market ($AIA tokens).

• Long-Term Benefits: A robust liquidity pool enhances the stability and attractiveness of $AIA tokens.

• Warrior Empowerment: Survivors become strong holders of $AIA tokens, fostering loyalty and trust within the ecosystem.

Cons

• Staking Complexity: Modifying the staking mechanism to include $AIA tokens adds complexity to the system.

• Risk of Centralization: If too few warriors hold large amounts of $AIA tokens, it could lead to centralization risks.

• Adoption Challenges: New participants may find it difficult to understand and engage with the liquidity pool concept.

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Comparative Table

Criteria	Option 1: SOL Vault	Option 2: $TT Tokens	Option 3: $AIA Liquidity Pool
Ease of Implementation	High	Medium	Low
Market Impact	Low	Medium	High
Community Engagement	Low	Medium	High
Token Growth	None	Supports $TT	Supports $AIA
Liquidity Creation	None	None	High
Risk of Volatility	Low	Medium	High
Alignment with Goals	Low	Medium	High

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Final Considerations

Choosing the right distribution path depends on TradeTant’s priorities:

• Short-Term Simplicity: If the focus is on simplicity and immediate rewards, Option 1 (SOL Vault) is the best choice.

• Ecosystem Growth: If the goal is to promote $TT token adoption and align rewards with the ecosystem’s goals, Option 2 ($TT Tokens) is ideal.

• Long-Term Sustainability: If TradeTant aims to build a self-sustaining ecosystem with high community engagement, Option 3 ($AIA Liquidity Pool) offers the most potential but requires careful implementation.