Overview

Transaction Fees

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 holders are 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.