> For the complete documentation index, see [llms.txt](https://docs.snowballfi.app/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.snowballfi.app/documentation/overview.md).

# Overview

**Snowball Protocol** fuses token economics, AVAX-collateralized minting, high-leverage loans, and gamefied staking into a single, tightly integrated DeFi ecosystem. The **`$SNOW`** token is backed by $AVAX and features a mathematically enforced, up-only backing model that increases over time.

Snowball is incubated by [MCLB DAO](https://mclb.org/) and built with inspiration from [BakerDAO](https://www.bakerdao.io/) and [Eggs Finance](https://eggs.finance/), reimagined for Avalanche with meme-fueled branding, dynamic vault structures, and a bribe-based growth flywheel.

***

### ❄️ How It Works

* Users mint `$SNOW` by depositing  `$AVAX`
* Users can melt `$SNOW` to redeem `$AVAX`
* Users can borrow `$AVAX` at up to 99% LTV against their `$SNOW`
* There are whitelisted pre-deposit vaults that let users mint `$SNOW` at fixed prices alongside others in the same tier
* The bonding curve and fee design ensure that backing per `$SNOW` always increases, regardless of user behaviour.

The initial supply of `$SNOW` will be determined by the total `$AVAX` committed in pre-deposit vaults. Max initial cap of `$SNOW` will be `5 million`. After that, the supply cap is dynamic and may be adjusted based on liquidity, vault usage, and protocol performance.

{% hint style="warning" %}
Due to protocol fee mechanics, the maximum theoretical AVAX loss is 5% (2.50% mint + 2.50% burn), though real losses are typically lower — and backing per $SNOW continues to rise.
{% endhint %}


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