TL;DR: $GLOOM is migrating from a reflections token to a standard ERC20 token. This means we will not longer be a reflection token or have a tax.
Background Context
When launching $GLOOM I thought it would be great to add in unique features to allow us to stand out in the sea of meme coins, so I thought reflections were the perfect feature. What I did not anticipate is the limiting capabilities of a V2 router that come with having a FoT (Fee on Transfer) / Reflection token. This involves some technical concepts but I will break them down in an easy to digest manner.
$GLOOM launched as a reflection token, this means that your balance was not a set integer but calculated based on a formula. When a transaction occurred (buy, sell or transfer) there would be a tax deducted from the transaction amount - in $GLOOM's case 1% - and automatically redistributed to remaining holders. Because of this unique feature, $GLOOM was limited to a Uniswap V2 router (as V3 does not support FoT or reflections tokens). We launched our LP on Pancake Swap then when Uniswap launched V2 support for L2 we were the first reflections token to create a pairing.
Limitations of a V2 Router vs V3
Full Range Liquidity: V2 routers do not allow for concentrated liquidity positions, only full range positions. This is a limiting factor to some institutional LP providers who prefer to monitor and mitigate risk with concentrated positions. Concentrated liquidity also allows a provider to earn higher fees on trades that occur within their range.
Reward Distribution: When providing liqudity for a V2 pool the rewards you earn are automatically redistributed back into the pool. This makes it extremely difficult to maintain accounting of rewards earned and therefore not ideal for institutional investors who need to keep strict records of earnings. When creating an LP for a V3 pool your rewards are calculated seperately and you are able to claim rewards without removing initial liquidity.
Wallet Swap Limitations: Certain wallets such as Rainbow Wallet, which is a popular wallet option amongst our community, currently only support a V3 router. This means if you try to do a swap in the wallet the transaction will revert because they do not support the V2 router.
Application Limitations: Certain applications such as Zora use a V3 router, this means that if we kept the reflection token we would not be able to mint NFTs through Zora using our token.
In conclusion, the journey of $GLOOM from a reflections token to a standard ERC20 token marks a significant evolution in its functionality and accessibility. While reflections initially distinguished $GLOOM in the crypto landscape, the transition addresses technical limitations posed by V2 routers, paving the way for greater flexibility, liquidity management, and compatibility with a broader range of wallets and applications. As $GLOOM embraces this change, it underscores its commitment to adaptability and innovation in the ever-evolving cryptocurrency ecosystem. The migration period is currently active, you will have 30 days to migrate your old $GLOOM to new $GLOOM. The last day for migration is May 11th, 2024. To migrate your tokens please visit https://app.gloomtoken.xyz
