13.3 Appendix: Technical Details & Formulas

1. Index Calculation Methodology for MemeIndex 500

To maintain transparency and consistency in the MemeIndex 500, we apply a weighted formula inspired by traditional financial indices:

Market Cap Weighted Formula:

Where:

• MI500MI_{500}MI500​: MemeIndex 500 value

• MCiMC_iMCi​: Market capitalization of meme coin iii

• WiW_iWi​: Weight assigned to meme coin iii based on its proportion to the total market cap

Weight Calculation Formula:

Weights are updated regularly to reflect market dynamics.

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2. Rebalancing Algorithm

The index is rebalanced quarterly to maintain alignment with market conditions. The process involves:

• Removing tokens that no longer meet liquidity, trading volume, or market cap criteria.

• Adding new tokens based on defined inclusion metrics.

Inclusion Criteria:

1. Minimum 30-day average trading volume of [X Tokens].

2. Market capitalization ranking within the top 500.

3. Verified on-chain contract security audit.

4. Active community engagement metrics.

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3. Staking and Reward Formula

MemeIndex DAO offers staking rewards based on participant contributions to liquidity pools.

Staking Reward Formula:

Where:

• RiR_iRi​: Reward for participant iii

• SiS_iSi​: Amount staked by participant iii

• NNN: Total number of stakers

• RTotalR_{Total}RTotal​: Total reward pool for the staking period

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4. Voting Mechanism for DAO Governance

Governance within MemeIndex DAO follows a token-weighted quadratic voting system to encourage more inclusive decision-making:

Voting Weight Formula:

Where:

• ViV_{i}Vi​: Voting power of participant iii

• TiT_iTi​: Number of $MIDAO tokens held by participant iii

Participants must lock their tokens for a defined governance period to cast votes.

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5. Risk Analysis and Scam Detection Metrics

To assess the risk profile of meme coins, MemeIndex applies a scoring algorithm based on multiple parameters:

Risk Score Formula:

Where:

• LLL: Liquidity ratio

• CCC: Community engagement score

• VVV: Price volatility index

• SSS: Smart contract audit score

• W1,W2,W3,W4W_1, W_2, W_3, W_4W1​,W2​,W3​,W4​: Weight factors calibrated through machine learning models

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6. Predictive Analytics Model for Meme Coin Trends

MemeIndex utilizes AI-driven regression models for trend prediction:

Regression Model:

Where:

• YtY_tYt​: Predicted price trend of meme coin at time ttt

• X1tX_{1t}X1t​: Social sentiment data at time ttt

• X2tX_{2t}X2t​: Trading volume at time ttt

• β0,β1,β2\beta_0, \beta_1, \beta_2β0​,β1​,β2​: Model coefficients

• ϵt\epsilon_tϵt​: Error term

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7. Smart Contract Structure and Security Audits

Key Components:

• Governance Contracts: Handle voting, proposal submissions, and treasury allocation.

• Staking Contracts: Manage user deposits, reward distribution, and staking lock periods.

• Liquidity Pool Contracts: Provide automated market-making functionalities.

Security Best Practices:

• Regular audits by external security firms

• Automated testing for smart contract vulnerabilities

• Bug bounty programs to incentivize community-based security reviews

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8. Formula for MemeIndex 500 Token Value

The MemeIndex 500 Token ($MI500) reflects the value of the top 500 meme coins:

Token Value Formula:

Where:

• Pi​: Price of meme coin i

• QiQ_iQi​: Quantity held in the index

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This technical appendix provides detailed formulas and methodologies to ensure the integrity and transparency of the MemeIndex DAO platform.