# Protocol Fee Distribution

**Fee distribution mechanism where 65% of trading fees goes towards MMF holders, and 30% of trading fees goes towards MLP holders.** With this improved fee distribution mechanism, our team will be seeking to:

(1) Buying back MMF to maintain MLP staking APR based on the above guidelines

(2) Forming of MMF-MLP protocol-owned-liquidity, so as to have lower volatility for if MLP holders decide to sell MMF incentives. That said, we believe that MMF will be mid-term deflationary, and is well worth holding.

(3) Excess trading fees will be placed into a floor price fund. This floor price fund will be used to buyback MMF to maintain APR in situations of excessive dips. This is to prevent users from using the 65% trading fees as immediate exit liquidity.

(4) 30% of the trading fees that goes back to MLP holders will adopt the same mechanism of distribution as per previously (we anticipate APR to be roughly 15–20% for this category).

(5) 5% of trading fees goes to the team treasury to maintain the platform and to fund daily operations\
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We decide to do this to align the incentives between both MLP and MMF holders. MLP holders want to get additional yields on their large cap cryptocurrencies. Whereas MMF holders wish to see the value of MMF tokens gradually increase. In doing the above, we will now have more funds to ensure that MMF token holders (who provide incentive liquidity) are kept happy due to a token that has constant buybacks that pushes up token prices. MLP holders are also better rewarded because they now get to farm more of an incentive token that seeks to rise in value over time. More importantly for MLP holders, we are providing guarantees to the amount of APR we can provide due to the larger amount of funds we can use to adjust APR (without inflating circulating supply). We believe that this set of incentives is equitable, and competitive, which will allow us to bring the entire MM ecosystem to greater heights.

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