Return Distribution

Noon generates returns across a diversified basket of strategies, and this page covers what happens to them next. The short version: the large majority goes to the people holding $sUSN, and the rest funds the protection and operation of the protocol.

The split

Every day, the protocol's raw returns are divided three ways:

How sUSN holders returns

The 80% flows to $sUSN automatically. There is nothing to claim, no rewards to harvest, and no transaction to sign: your $sUSN simply becomes worth more $USN as the protocol earns, every day, whether you check the app or forget it exists for a year.

That yield is also boosted by design. $sUSN holders forgo their share of the returns in exchange for earning Noon points at a much higher rate, and the yield they give up flows to $sUSN holders instead. The more of the supply that sits in $USN chasing points, the more concentrated the yield becomes for everyone in $sUSN.

$sUSN holders also receive a small allocation of governance tokens, so the people whose capital powers the protocol have a say in how it runs. See $NOON and $sNOON.

Where the other 20% goes

The Insurance Fund (10%) is the protocol's buffer. It absorbs strategy-level volatility so temporary drawdowns don't reach your yield, covers the deductible when an insurance claim pays out, and covers slippage when positions need to unwind quickly. Contributions season before release, and surplus is used to buy back $NOON and distribute it to stakers, so the fund either protects the protocol or returns value to the community. Full mechanics available on the Layered Insurance page.

The Operations Fund (10%) covers the cost of running Noon infrastructure, audits, custody, and the team that maintains all of it. Excess operating funds flow onward into the Insurance Fund rather than accumulating.

For where the returns come from in the first place, see Return Generation and our Deployment Strategies.