Protocol Fee and Rewards
Validation rewards that K9 Finance DAO receives are split into five parts:
0%* of all the rewards gets re-delegated (re-staked) on the K9 Finance DAO validators.
Importantly, re-delegation happens without issuing new knBONE tokens. Instead, these BONE tokens are delegated to the validators directly along with users' deposits.
The re-delegation mechanism plays a critical role in boosting the value of knBONE. By continuously accumulating and re-staking a portion of the rewards, the total amount of staked BONE in the system constantly increases.
In essence, the knBONE system automatically reinvests a part of the rewards back into itself, amplifying returns for users without altering the total knBONE token supply. This helps maintain token value stability while offering users a lucrative staking experience.
Remaining 100%* gets split into 4 parts:
5% goes to the DAO Treasury to cover the protocol costs
0% gets split up across all other validators as a reward
95% goes to the Real Yield Staking rewards pool
0% goes to the Liquid Staking Instant reward pool
All fees are distributed in the form of BONE. The fee percentages are set by the K9 Finance DAO Governance and stored on-chain. *Protocol fee splits will be decided on by the management council and can be voted on by the DAO. The most recent proposal for fees & rewards can be found in the K9 Finance Governance Forum.
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