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description: Net Elastic Rebase Depletion
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# NERD

![](https://2776910322-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2F4YcmeIdWg0gOsSa4JurE%2Fuploads%2FL6JVnxUMh3n2HqUq9Buk%2FNERD.png?alt=media\&token=fbdaba16-b5ef-4fa5-b4f3-7041075ef436)

### Overview

We’ve developed something called a Net Elastic Rebase Depletion (NERD) protocol. What this does is track that your Net Deposits (ND) are at a positive, meaning you’re not over dumping, and then gradually applies a negative rebase on the GFV to make up for undesired behavior.

If your ND is positive, meaning you’ve deposited, compounded, and been airdropped more than you’ve claimed, you’ll continue to receive your positive rebase at 100%.

If your ND goes negative, your rebase rewards will reduce and can even negatively to affect your GFV. Don’t worry, your NFV (deposits) will never be touched, meaning worst case you will always receive 1% on your Net Faucet Value (Deposits +compounds + airdrops), but your rebase rewards will become non-existent if behavior is not adjusted.

Please note, GFV compounds are counted in your GC which affect your Capped Payout, but not your Net Deposits. This means that compounding NFV always increases your Net deposits, while compounding your GVF has a neutral affect and doesn’t not affect your ND. This is due to the fact that NERD can reduce your GFV value so therefore is not in fact an increase, but instead a current metric of which to reward. However claiming GFV and NFV rewards counts against your ND equally.

{% hint style="info" %}
Keep an eye on the NERD guage to assess the current state of your ND.&#x20;
{% endhint %}

Simply; our NERD protocol rewards positive activity and responsibly taking profits with full rebase rewards, and punish those dumping without regard by adding that offenders rebase to the rewards pool to continue paying out the positive players.

### NERD Depletion Rate

As long as your ND is above 0, you will continue to earn the full 2% rebase Daily.&#x20;

As your ND declines below 0 to -33% of your NFV, your rebase rewards will decline from 100% (2%) to 0.&#x20;

Should  you dump further, your accumulated GFV will begin to decline, to the point at which it is equal to your NFV, the lowest in can go.&#x20;

To earn rebase rewards again, you will need to deposit or compound until your ND goesback  above -33%, and once you're back above 0, you will be back the the full 2% daily again.&#x20;

{% hint style="info" %}
A negative NERD reduces the liabiity of the rewards pools, and is taken into account when anticipating the need to mint. Meaning, that as people dump, this actually has a net positive on the ecosystem as the less tokens will be minted over time.&#x20;
{% endhint %}
