Rebase Token
A token whose total supply automatically expands or contracts across every holder's balance, rather than its price moving to reflect supply/demand alone.
A rebase token is a token whose total supply automatically expands or contracts at set intervals, with the adjustment applied proportionally across every holder's balance — rather than relying solely on price moving to reflect changes in supply and demand, as a standard fixed-supply token does.
The goal of this design varies by project, but is commonly intended to push the token's price toward a target level by adjusting supply directly; it's a structurally different mechanism from a stablecoin's typical collateral-backed or algorithmic peg approach, and carries its own distinct, documented risks around holder confusion and the mechanism's actual effectiveness.
Examples
- A rebase token's holder balance can change automatically between two points in time, even without that holder buying or selling anything.
- A rebase token's percentage ownership of total supply stays the same through a rebase event, even though the absolute number of tokens held changes.