# How it works ## Our building blocks **Noon** features a familiar dual token structure: * $**USN** (**USN**) is Noon’s stablecoin. It is pegged 1:1 to the US dollar. * Staking **USN** allows users to access $**sUSN** (**sUSN**), a token which appreciates as the protocol generates return * $**NOON** (**NOON**)is **Noon’s** governance token (available after **$NOON** TGE[^1] in Q2 2025). * Staking **NOON** allows users to access $**sNOON** (**sNOON**), a staked Governance token ## Mechanics This is a very quick summary of the mechanics of the **Noon** protocol. ### Acquiring and divesting tokens **Acquire**: Users can use collateral (like USDT or USDC) to mint or buy **USN**. Users can stake **USN** to get **sUSN** - or buy it on the open market. Only users and team members will be granted **NOON** - everyone else will need to buy it on the open market. Users will be able to stake **NOON** to receive **sNOON**. **Divest**: Users can sell **USN** and **sUSN** on the open market. Alternatively, users can unstake **sUSN** to receive **USN**, and then redeem **USN** for USDC or USDT. Users will be able to unstake **sNOON** to recieve **NOON**, and sell **NOON** on the open market. ### Yield generation and distribution **Yield generation**: Collateral received by **Noon** is used to generate yield via our delta-neutral strategies. **Return distribution**: 80% of the protocol's raw returns are directed to **sUSN** holders. 10% are directed to the Noon Insurance Fund. 10% are directed to the Noon Operations Fund. ### Insurance and operations funds **Noon Insurance Fund**: The **Noon** Insurance Fund receives 10% of protocol yield. It uses its funds to address any security incidents that impact **Noon** users. After 3 months, if unused, funds are distributed to **$sNOON** holders. **Noon Operations Fund**: The **Noon** Operations Fund receives 10% of protocol yield. It uses these funds to cover the costs of **Noon**'s operations. After covering these costs, and building up a operating reserve, the **Noon** Operations Fund will re-direct all excess funds to the **Noon** Insurance Fund. ### Token value propositions **Value proposition of**** ****USN**: **USN** holders forgo rights to the raw yield generated by the deposited collateral. Instead, **USN** holders are rewarded with a disproportionate governance token reward. Holders of **USN** will be rewarded if and when the value of the **Noon** governance token appreciates. **Value proposition of**** ****sUSN**: **sUSN** holders receive the majority of the yields generated by the deposited collateral. This yield is boosted by the yield foregone by **USN** holders. **sUSN** holders also receive a small amount of governance tokens to ensure they can participate in **Noon** governance. **Value proposition of**** ****NOON**: **NOON** holders will be able to stake their tokens to receive **$sNOON**. **Value proposition of**** ****sNOON**: **sNOON** holders will be able to vote on all Noon governance proposals, like the addition of new delta neutral strategies to the protocol. **$sNOON** holders will also receive any unused funds from the **Noon** Insurance Fund. ### Points and boosts **Points program**: **Noon** now has a live points program, where holders of **USN** and **sUSN** are rewarded for their token balances and on-chain activity. Points accrue **in real time** and are displayed directly within the **Noon**** dapp**. These points serve as the primary mechanism for early community participation. When the **Noon** governance token TGE took place in **Q2 2025**, all participants became able to convert their earned points into **$NOON**** tokens**. **Point boosts**: Users will be able to "boost" the points they receive by participating in activities with our partners, like providing **USN** and **sUSN** liquidity on DEXes, or depositing **USN** as collateral on lending protocols. **Token boosts**: When converting points to tokens, users will be able to choose to stake their tokens for up to 12 months to receive significant additional token rewards. [^1]: Token Generation Event --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.noon.capital/noon-the-basics/how-it-works.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.