Main features of CANTO

Canto DEX: zero-fee decentralized exchange (DEX)

Canto decentralized exchange (DEX) is committed to providing accessible trading and liquidity services to the public, completely eliminating transaction fees. Unlike traditional DEXs that charge transaction and liquidity fees, Canto DEX allows users to participate in trading and providing liquidity in a zero-cost and more efficient manner. This zero-fee model greatly encourages user participation, as they do not have to worry about fees eroding their assets. This feature is particularly attractive to retail investors and high-frequency traders.

Canto DEX operates on an automated market maker (AMM) model, encouraging participation by providing liquidity providers with rewards proportional to the liquidity they contribute. As a fee-less exchange, Canto DEX fully embodies the concept of 'Free Public Infrastructure' and offers a sustainable and convenient solution for the DeFi sector.

CANTO Loan Market: Decentralized Lending Service

Canto Lending Market (CLM) is a fund pool-based lending protocol that provides decentralized asset lending services. It is developed based on the Compound v2 protocol, allowing users to deposit assets to earn interest or borrow assets by collateral. By pooling user deposits, CLM achieves fully decentralized, permissionless lending services without any third-party involvement or centralized control.

CLM's zero fee structure means that users do not need to pay transaction fees when borrowing or depositing, which further reinforces Canto's concept of "Free Public Infrastructure". In addition, by adopting the widely trusted and verified lending model (Compound), Canto provides users with a safe and familiar experience, creating a secure and reliable environment for users to confidently engage in lending operations.

NOTE: Canto's accounting unit and stable trading medium

NOTE is a unique stable asset of CANTO, serving as a decentralized accounting unit within the ecosystem. Unlike traditional stablecoins that rely on centralized reserves and pegging to fiat currency, NOTE adopts a fully collateralized mechanism and is loosely pegged to the US dollar. Users can use assets such as USDC and USDT as collateral in the CANTO lending market (CLM) to mint NOTE, ensuring its stability within the ecosystem.

As a core stable asset in the Canto ecosystem, NOTE plays a key role in trading, lending, and other DeFi activities. NOTE is managed in a decentralized manner through CLM, which is in line with Canto's concept of "free public infrastructure" and provides users with a stable, reliable, convenient and easily accessible trading medium, while effectively avoiding rental extraction issues.

CANTO Token

CANTO token serves as the native utility token of the Canto blockchain, playing a core role in network operation, security, and governance. The token is designed in line with the concept of Canto's "free public infrastructure" and serves multiple key functions in the ecosystem, including ensuring network security through a staking mechanism and empowering users with governance rights.

CANTO Token Staking

Canto operates on a Proof-of-Stake (PoS) consensus mechanism, ensuring network security through the staking of CANTO tokens by validators and users. Participants contribute to the security of the blockchain by staking tokens, enabling validators to process transactions and maintain the integrity of the blockchain. Staking CANTO not only rewards users but also encourages active participation in network security and stability. This staking mechanism supports network operation and achieves decentralized security, fully embodying Canto's community-driven infrastructure philosophy.

Staking CANTO tokens also creates opportunities for users to participate in the healthy development of the ecosystem, allowing users at all levels to easily support Canto's decentralized infrastructure.

Governance

CANTO tokens give users the right to participate in platform governance. In a community-based governance model, CANTO holders can propose and vote on key issues affecting network development, such as technical upgrades, policy changes, and resource allocation. This participatory governance ensures that the ecosystem remains democratized, allowing the collective will of the community to drive project development.

Compared to other DeFi platforms, the governance of CANTO tends to be more in line with its mission of decentralization and community participation, rather than favoring large holders or centralized entities. This design allows the CANTO ecosystem to better respond to user needs and ensure that the infrastructure truly serves all participants.

Trading fees

While Canto's core DeFi services, such as Canto DEX and lending market, are feeless, trading on the network still requires the use of CANTO tokens to pay minimal transaction fees. These transaction fees are used to prevent spam transactions and ensure the efficient operation of the network. By keeping the fees low and applying them only to the overall operation of the network rather than specific services, Canto upholds its commitment to 'feeless public infrastructure' while supporting the underlying infrastructure of blockchain.

Trading fees are a common feature in the blockchain ecosystem, and by using CANTO as a payment medium, these fee settings incentivize the use of tokens without imposing excessive cost pressures on users.

NOTE

In addition to the CANTO token, the Canto ecosystem also includes the NOTE, which is a stable unit of account designed to provide a reliable medium of exchange for the network. Unlike traditional stablecoins that rely on centralized reserves, the NOTE is generated through fully collateralized borrowing in the Canto Lending Market (CLM). Users can mint NOTE by depositing collateral assets such as USDC and USDT in the CLM, creating a stable and decentralized asset that is loosely pegged to the US dollar. The NOTE has the following key functions in the Canto ecosystem:

• Trading MediumNOTE can be used for transactions in CANTO service, providing stable value and reducing the volatility risk faced by users.
• Loan collateralNOTE can also be used as collateral in CLM, allowing users to participate in lending activities without relying on external stablecoins.
• In line with the concept of decentralizationAs NOTE is generated through a decentralized protocol, it aligns with CANTO's goal of building neutral, non-extractive infrastructure.

Through NOTE, Canto has built a stable and accessible asset, which complements the CANTO token, creating a more stable and friendly environment for DeFi activities.

Token Economy and Functionality

Staking rewards and network security

Staking is one of the core functions of $CANTO token. As a Layer-1 blockchain that adopts Proof-of-Stake (PoS) consensus mechanism, Canto requires validators to stake $CANTO tokens to ensure network security, process transactions, and maintain the integrity of the blockchain. Validators and delegators who delegate tokens to validators receive staking rewards for participating in network security, which are compensation for their contributions.

Staking Rewards

• Validators and delegators are rewarded in the form of $CANTO to incentivize users to support the network operation.
• This reward mechanism encourages active participation of community members and helps to form a truly decentralized network of stakeholders.

Staking not only provides rewards for participants, but also strengthens network security. By distributing the staking responsibility to a large number of validators, Canto has established a more decentralized and reliable system.

Governance participation and community-driven development

$CANTO tokens give holders governance rights, allowing them to participate in important decisions for the future development of the network. In a decentralized governance model, $CANTO holders can propose changes to the ecosystem and vote on matters such as protocol upgrades, resource allocation, and policy adjustments.

Governance Purpose

• Proposal: $CANTO holders can submit proposals, which will be reviewed by the community and voted on. This process ensures that changes to the network reflect the needs and priorities of the users.
• VoteEach $CANTO token represents one voting right, and holders can directly influence decision-making. Although users holding more $CANTO have greater voting power, this mechanism still maintains the openness and accessibility of the ecosystem.

Through this governance mechanism, Canto puts community opinions first and fully supports user-driven development. This governance model effectively reduces centralized control, which is in line with Canto's vision of building a transparent and inclusive financial infrastructure.

Trading fees and ecosystem operation

In the Canto ecosystem, $CANTO is used to pay for basic network transaction fees to ensure smooth network operation and prevent spam transactions. Unlike other DeFi projects, Canto does not charge specific services such as trading or borrowing, only minimal network operation fees. This fee structure fully complies with Canto's commitment to "free public infrastructure," allowing users to use basic DeFi services for free.

Trading fee usage:

• Basic Network Transaction: $CANTO is used to pay small fees related to standard network operations, ensuring the efficient and secure operation of the network.
• Incentive Validators: Transaction fees provide continuous rewards to validators, supplementing staking rewards and promoting the sustainable development of the ecosystem.

By using $CANTO as the medium of payment for transaction fees, Canto maintains the accessibility of the ecosystem, while ensuring that costs do not hinder user participation in DeFi services.

As collateral and additional incentive features

In addition to staking, governance, and paying transaction fees, $CANTO can also serve as collateral in the Canto ecosystem. As the ecosystem grows, this functionality may be further expanded. Currently, Canto's design encourages the use of $CANTO in various DeFi activities, such as lending or liquidity provision, which may come with additional rewards.

Purpose of Collateral and Incentives:

• Liquidity Provision: $CANTO can be used in liquidity pools to enhance liquidity in the Canto decentralized exchange, promoting active participation and community-driven growth.
• Extra IncentivesCanto will regularly launch reward programs to encourage $CANTO holders to participate in activities beneficial to the ecosystem, such as liquidity mining or special governance plans.

By integrating $CANTO at multiple levels of the ecosystem, Canto not only strengthens the core principles of decentralization and user empowerment, but also nurtures a self-sustaining community that allows users to directly benefit from their contributions.