> For the complete documentation index, see [llms.txt](https://docs.sweep.finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.sweep.finance/system-architecture/value-flow/distribution-mechanism.md).

# Distribution Mechanism

The Sweep ecosystem operates on a volume-driven distribution system powered entirely by real user activity.

Every transaction within the platform — particularly gameplay interactions — generates measurable volume on the **BNB Smart Chain (BSC)** network. The protocol fees generated through this activity are automatically allocated across two components:

* **50% is directed to the SWEEP burn mechanism**
* **50% is distributed to eligible SWEEP holders in USDT**

This process is executed automatically through smart contracts, with both mechanisms funded directly by protocol fee generation rather than manual intervention or external funding.

***

### **How distribution works**

As users interact with the platform, a continuous stream of transaction volume is generated.

Each individual transaction contributes to the total ecosystem volume and is processed on-chain. Protocol fees generated through these transactions are automatically integrated into the platform’s economic mechanisms.

The collected fees are split equally between two components:

* **50% is allocated to USDT distribution**
* **50% is allocated to the SWEEP burn mechanism**

The distribution mechanism operates in real time. The USDT portion of the protocol fees generated by each transaction is distributed directly to eligible SWEEP holders, proportionally to their share of eligible SWEEP holdings.

This means that:

* Distribution is not delayed or accumulated over time
* Rewards are generated continuously as transactions occur
* Eligible holders receive their proportional share directly on-chain as ecosystem activity takes place

As a result, reward distribution is directly tied to live ecosystem activity, creating a system where every interaction contributes to the economic flow.

***

### **Distribution Simulation Example**

The following example illustrates how the distribution mechanism works under a hypothetical scenario.

Assume that activity across the Sweep ecosystem generates **$500,000 in total protocol fees** within a given period.

From these protocol fees:

* **50% ($250,000) is allocated to the USDT distribution pool**
* **50% ($250,000) is allocated to the SWEEP burn mechanism**

Now consider an eligible user representing **1% of the total eligible SWEEP holdings**.

In this scenario, the user would receive approximately:

* **$2,500 USDT from the distribution pool**

> This example is provided for simulation purposes only. Actual rewards depend on real-time ecosystem activity, protocol fees generated, eligible SWEEP holdings, and user participation. The purpose of this model is to demonstrate the direct relationship between platform activity, protocol fee generation, and reward distribution.

***

### **Sustainability through usage**

Unlike systems that rely on external emissions or inflationary rewards, Sweep’s model is based entirely on real activity.

There are no artificial reward injections. Instead:

* Value is generated through usage
* Distribution is tied to actual volume
* The system scales with user participation