Rebase Token
A token whose supply automatically expands or contracts, changing your balance count while targeting a price or yield.
A rebase token periodically adjusts its total supply algorithmically — every holder’s balance rises or falls proportionally at each rebase. Some use it to target a price peg (elastic-supply stablecoins); others use it to deliver staking rewards by simply increasing your token count over time.
The mechanism confuses newcomers: your balance changes without any transaction, and a rising balance doesn’t necessarily mean rising value — price can fall to offset supply growth. Rebasing also breaks assumptions in other contracts, so rebase tokens often need wrapped versions to work in DeFi. Read the mechanism carefully; the number in your wallet is not the whole story.