Rebase Protocol refers to a mechanism used in certain cryptocurrencies to adjust the token supply automatically based on specific market conditions. This adjustment can lead to changes in the total number of tokens held by users in their wallets, aiming to stabilize the token’s price.In a rebase event, the protocol either increases or decreases the total supply of tokens based on a predetermined formula. For example, if the price rises significantly, the supply might be inflated to encourage selling and reduce the price. Conversely, if the price falls, the supply could be contracted to bolster the price.This concept allows users to hold a fluctuating number of tokens while maintaining the same proportion of their value relative to the total supply. The aim is often to achieve price stability, providing a more predictable environment for users. However, it can also lead to confusion, as users may see their token balances change without any action on their part.