# $PRO Taxation and Game theory in Peak Finance

As is the case in cryptocurrencies, those that build positions in an asset or protocol before others have the confidence to enter an asset are the ultimate beneficiaries of a protocol’s success.&#x20;

However, this also leads to predatory behaviour whereby users will only participate in the success of a protocol and subsequently not only neglect to support the longevity of the protocol, but shamelessly contribute to its decline.

For this, we have applied a 10% Sell Tax in any protocol state. Of that 10%:

* 6% is burned from circulation
* 4% is returned to the Peak DAO Treasury

We believe this is a sensible mechanic, as those that are directly supporting the protocol in Base Camp are only being taxed on their rewards.&#x20;

However, to protect the protocol, we have applied a 10% buy tax that ONLY APPLIES when the peg is greater than 1.05. This rewards those that have supported the protocol back to peg and minimizes predatory behaviour from those that would seek to ‘snipe the peg’.

$PEAK emissions during the inflationary epoch are significant. With an APR that is often more than 10,000%+ (actual number contingent on your share of all $PRO staked in The Summit), it is entirely likely that a new entrant will receive more $PEAK than the cost of their $PRO if they have short-term goals.&#x20;

Again, those who directly support the protocol and obtain $PRO through farming will ultimately benefit from a 10% entry tax above a peg of 1.05.&#x20;

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