# Overview

#### **The Economic Engine Behind SIRE**

SIRE’s token economy is built around transparency, fairness, alignment, and sustainability.\
Every action: staking, adding to aVault, or using aLink will flow back into the network through automated, on-chain mechanisms that reward participation and strengthen protocol resilience.

#### **aVault System Flow** 

<figure><img src="https://4186712670-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FIVjieZ3cpsSnIed6VdXM%2Fuploads%2Fc8NWllNmTBBsdNhcol6y%2FTokenomics_SIRE.png?alt=media&#x26;token=489f0d28-0449-426b-90ee-b3a8d4410c26" alt=""><figcaption></figcaption></figure>

Every protocol action feeds into staking rewards, treasury funding, and ongoing buybacks, creating a transparent, self-sustaining loop.

#### **How It Works**

**1. Participation → Protocol Activity**

Users add USDC to aVault, stake SIRE to reduce fees. These activities generate on-chain performance and platform fees.

**2. Fee Structure**

* **Performance Fee:** 20% base, scaling down to 10% depending on SIRE staked.
* **Withdrawal Fee:** 2% base, scaling down to 1% with higher staking tiers.
* **Management Fee:** 2% annualised, split between treasury funding and SIRE burns.

**3. On-Chain Distribution**\
All fees are distributed automatically:

* 50% → Staking pool (potential rewards for stakers)
* 30% → DAO treasury (ecosystem development)
* 10% → dTAO purchase (infrastructure support)
* 10% → SIRE buybacks (market sustainability)

#### **Token Utility**

* **Stake:** Participate in potential on-chain rewards from αVault performance.
* **Access:** Unlock αLink tools and analytics.
* **Reduce Fees:** Lower performance and withdrawal fees by staking SIRE.
* **Buybacks:** A share of protocol fees funds ongoing buybacks to support network stability.

#### **Transparency & Alignment**

Every fee, burn, and buyback is verifiable on-chain.\
The more users participate, the stronger the feedback loop between SIRE’s utility, treasury growth, and long-term sustainability.