Transaction fees constitute Neutron’s main source of revenue. They originate from local transactions and cross-chain transactions through Neutron’s IBC fee model. Transaction fees are paid in NTRN or ATOM tokens.
- 25% of the fees are sent to the hub as payment for ICS;
- The remaining 75% are either burnt (NTRN) or sent to the Reserve (ATOM, etc.).
Reserve, Treasury and Distribution Contract
There are 3 contracts that manage Neutron’s funds:
- The Reserve holds the vested NTRNs and sends them to the Neutron DAO core contract and the Distribution contract. Reserve tokens are vested based on on-chain activity: the more NTRN tokens are burned while processing block fees (see above), the more tokens get unlocked in the reserve;
- The Distribution contract is responsible for the second step of token distribution where tokens sent to this
contract are distributed between
share holders, where
share holdersare a configurable set of addresses with number of shares. This contract allows shareholders to withdraw collected tokens.
- The third one is Neutron DAO core module itself.