⭕How Does Yield Work?

[DeFi Explained]

NFT Creators:

Stable Revenue Stream: Creators launching their NFT projects on Cycle can benefit from a stable and ongoing revenue stream. This revenue is derived from leveraging the initial sale of NFTs by supplementing continuous yield generated through DeFi protocols.

Yield from DeFi Investments: When creators launch their NFT projects on Cycle (and sell their NFTs), the proceeds from those sales are invested in various DeFi protocols. The DeFi investments aim to generate yield through activities such as liquid staking, providing liquidity to pools, or utilizing other yield-generating mechanisms in the decentralized finance space.

Redistribution of Yield: Yield redistribution on the Cycle platform leverages liquid staking and other DeFi mechanisms to share returns. Most liquid staking involves buying a DeFi token at a certain price and seeing its value increase over time (as yield). Cycle allows Creators to set aside a fraction of that profit for redistribution among owners. If a DeFi token's value rises (in relation to $SOL), a small portion of that gain is swapped back into $SOL and distributed among token holders. This distribution happens on a monthly basis for staking participants.

NFT Owners:

Participation in Yield Sharing: NFT owners also have the opportunity to participate in the yield generated from DeFi investments through a staking protocol. Based on predetermined revenue-sharing models set before the project's launch, NFT holders may receive a pro-rata share of the yield generated (monthly).

Liquidity and Redemption Options: Owners of NFTs on the Cycle platform can instantly redeem a portion of their initial mint funds, providing liquidity and flexibility.

Continuous Revenue Flow: By receiving a share of the yield generated from DeFi protocols, NFT owners can benefit from a continuous income stream. This ongoing yield distribution adds value to owning and holding NFTs on the Cycle platform.