Pen-X Documentation
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# Longevity Reward Scheme

A central feature of Pen-X is that its DAO members control the Fund in a decentralized fashion. This feature is achieved through the mechanism of the Pen-X Longevity Reward Scheme.
Investors in Pen-X funds are rewarded with the $PENX governance token every month as part of the Rebalancing Phase. ### Reward Calculation The amount of PENX Governance Token awarded to each member is calculated during the Calculation Phase according to the following formula, where "C" is a constant calculated to optimize the rewards whilst ensuring continued viability for the DAO: Using the square root of the longevity coefficient, retention is encouraged and incentivized early in the investment term, when the withdrawal is most likely. Later in the term, retention is encouraged by accumulated significant longevity coefficient, which would be reset if funds were withdrawn. ###$PENX Supply

The PENX Governance Token that is awarded to members, comes from the fixed supply minted and distributed to the DAO's treasury. Because no new PENX Token will be minted above the supply limit, the DAO will need to ensure that it has sufficient PENX Token liquidity in the DAO treasury to afford the Pen-X Longevity Reward each month. We are proposing several potential solutions:
• The DAO reserves the right to vary the constant "C" when necessary to preserve liquidity in the DAO.
• The DAO will use a PENX Token buyback scheme to ensure continued PENX Token liquidity in the DAO.
• PENX Token Rewards are awarded at an equal rate from a fixed percentage of the DAO treasury each month, maintained to ensure continuous affordability for the DAO.