Protocol Economics
How Underscore generates revenue and what happens with it
Underscore generates revenue through fees on value-generating activities. All protocol revenue is used to buy back RIPE tokens from Ripe Protocol, our partner protocol.
Revenue Sources
Vault Performance Fees (Primary)
The largest source of protocol revenue comes from Vaults — AI-managed yield strategies that optimize returns across DeFi protocols.
Fee: 20% of yield profits
Applied to: Profits only, never principal
When charged: When yield is realized
Example: A vault generates $100,000 in yield across all depositors
$20,000 → Protocol revenue
$80,000 → Distributed to depositors via increased share price
Vault performance fees scale with protocol TVL and yield performance, making this the primary revenue driver as Underscore grows.
Swap Fees
Charged on token swaps executed through Underscore wallets.
Fee: 0.25% of trade amount
Applied to: All swaps (including stablecoin pairs)
Example: $10,000 swap → $25 fee
External Reward Claim Fees
Charged when claiming rewards from integrated protocols (MORPHO, WELL, AERO, etc.).
Fee: 20% of claimed rewards
Applied to: External protocol incentives only
Example: Claim $200 in MORPHO rewards → $40 fee
What's Free
No fees on:
Transfers between wallets
Deposits and withdrawals
Idle funds
Debt operations (borrowing/repaying)
Liquidity provision
ETH/WETH wrapping
Revenue Allocation: RIPE Buybacks
All protocol revenue is used to buy back RIPE tokens from Ripe Protocol, our partner protocol.
Summary
Vault Performance
20% of yield
Largest (scales with TVL)
Swap Fees
0.25% of amount
Medium
External Rewards
20% of claims
Smaller
100% of revenue → RIPE buybacks
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