SODA staking rewards come from real protocol revenue. Every transaction routed through the SODAX system generates fees, and a portion of those fees is allocated to stakers.
🔍 Staking rewards are not created from thin air. They are funded by actual fees generated from cross-network activity across the SODAX ecosystem, making them directly tied to the usage and growth of the protocol.
How SODAX Fees Are Allocated
All transactions routed through the SODAX system generate fees. These fees are collected by the Fee Treasury and distributed across several initiatives designed for the long-term growth of the protocol:
50% to Protocol Owned Liquidity: Growing the liquidity that SODAX controls ensures reliable execution across networks.
20% to SODA Buy Back and Burn: A portion of fees is used to programmatically buy back and burn SODA tokens, reducing the total supply over time.
10% to the SODAX DAO: Funding for governance and community-led initiatives.
20% to SODA Stakers: This share is deposited into the staking pool, increasing the value of xSODA held by stakers.
How Staker Rewards Work
The 20% allocated to stakers is deposited regularly into the staking pool. As the pool grows in SODA terms, the value of each xSODA token increases relative to SODA. This means your rewards are reflected automatically in the growing exchange rate between xSODA and SODA, with no need to manually claim or re-stake.
The more activity that flows through the SODAX system, the more fees are generated, and the greater the rewards for stakers.
💡 Staking rewards are variable. Because they depend on fee generation, the returns you see will fluctuate with overall network activity. For more on expected returns, see "What APY can I expect from SODAX Stake?"
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