Protocol Economics

Main St's tokenomic structure balances user rewards with protocol sustainability on Sonic.

Revenue Distribution

Yield flows through our staking system:

• 75% to smsUSD Holders via the staking mechanism

• 10% to Insurance Fund for protocol resilience

• 15% to treasury

In circumstances where funding rates or yields significantly exceed competitive market rates, the protocol may retain a portion of yield from distribution. These retained yields may be allocated to multiple purposes including protocol operations, supplementing the insurance fund, and stabilizing returns during periods of lower market funding rates or yields. This mechanism helps ensure sustainable long-term performance.

Token Architecture

• msUSD - A dollar-pegged token that serves as the base asset in our ecosystem. Each token is backed by delta-neutral positions ensuring stability regardless of market direction.

• smsUSD - The staking token received when users stake msUSD, allowing them to earn yield from our delta-neutral strategies.

Protection & Governance

The Insurance Fund receives 10% of generated yield, serving as defense during market disruptions and ensuring 1:1 redemptions during temporary shortfalls.