> 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. A transparent protocol fee of **5%** is applied to this activity and is automatically split into two components:

* **2.5% is permanently burned in SWEEP**
* **2.5% is distributed to SWEEP holders in USDT**

This process is executed automatically through smart contracts and does not rely on 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. From every transaction, a fixed **5% protocol fee** is automatically applied.

This fee is instantly split into two components:

* **2.5% is allocated for USDT distribution**
* **2.5% is permanently burned in SWEEP**

The distribution mechanism operates in real time. The USDT allocated from each transaction is distributed directly to SWEEP holders, proportionally to their share of the total token supply.

This means that:

* Distribution is not delayed or accumulated over time
* Rewards are generated continuously with each transaction
* Holders receive their share directly on-chain as activity occurs

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

***

### **Distribution Simulation Example**

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

Assume that the Sweep ecosystem generates **$10,000,000 in total transaction volume** within a given period.

From this volume:

* **5% protocol fee is applied = $500,000**
* **2.5% ($250,000) is allocated for USDT distribution**
* **2.5% is used for token burn**

Now consider a user holding **1% of the total SWEEP supply**.

In this scenario, the user would receive approximately:

* **$2500 USDT from the distribution pool**

> This example is provided for simulation purposes only. Actual rewards depend on real-time transaction volume, total token distribution, and user participation. The purpose of this model is to demonstrate the direct relationship between ecosystem activity 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


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