Paloma Bridge Exit Tax for all Bridge Transactions to target chain from Paloma

EPIC 09/15/2023: Paloma Bridge Exit Tax for all Bridge Transactions to target chain from Paloma

Business Case

Volume wishes to encourage staking and securing the network when there is strong sell pressure. To achieve this, we propose implementing a bridge tax that will tax all outbound transactions from the bridge to the target EVM and other chains. Our rational is that more liquidity that is incentivized to stay will allow more opportunities to build native apps on Paloma that uses these tokens.


  1. When a user sends a Paloma token to EVM, the net tokens minted on the target chain will be the total tokens less the token tax % amount
  2. When a user sends an EVM token to Paloma, the net tokens minted on Paloma will NOT be subject to any tax and the user will receive the FULL amount.
  3. Bridge taxes are collected and rewards are claimable by staking users. As such, each staker will need a wallet to claim their stake rewards from the bridge tax.
  4. Governance vote for the Bridge Tax requires input of the tax amount and any excluded tokens.


Bridge Tax

  1. Tax rate is from Paloma to target chain only
  2. Tax Rate is determined by governance vote
  3. Tax Free tokens are determined by governance vote
  4. Tax is calculated on bridge transactions TO the EVM ONLY submitted and accepted into a block
  5. Tax is rewarded to Paloma GRAIN stakers

Tax Collection

  1. Bridge Tax is ONLY claimable by all staking wallets in proportion to their stake
  2. Bridge Tax is only claimable on Paloma in the Paloma denomination
  3. All claimable tokens require gas to process claims

Questions and Answers