How Orion Delivers Real Yield

A buzz is building around a new term in DeFi, “real yield,” representing a move toward more sustainable yield generation. The promise of real yield has its own risks and hinges on the quality of the business model that underpins it. Looking at Orion,  the team has already implemented a sound strategy to provide real yield, in foresight, as part of what the team is trying to accomplish.

The most recent 2021 bull cycle saw many unique (and too good to be true) opportunities, like three-to-four digit annual percentage yields (APYs) being promised as yearly “interest” generated from various yield farming mechanisms. Protocols were flooded from the demand for astronomical ields, but that is no longer the case today. In this bear market, lean conditions have brought liquidity providers and hustling DeFi projects back to Earth. Liquidity providers are tolerating less risk, and flawed DeFi models have experienced illiquidity and token hyperinflation (TIME Wonderland or OlympusDAO, anyone?).

Waking up from the dream of enjoying infinite money machines, the DeFi scene has come up with the notion of real yield. We will discuss what real yield entails and how Orion sets an ideal example for how real yield can be generated sustainably.

What is real yield?

In essence, real yield is a percentage of a protocol’s revenue that flows back to stakers, a bit like a dividend. When a protocol does so, the yield is identified as “real.”

Real yield is especially important when considering the unsustainable yields we saw in DeFi last year. Protocols advertising absurd yields rewarded their users with token emissions that were not supported by viable revenue models.

Real yield is therefore important, as it generally represents a safer, more sustainable model for generating sustainable yield.

The risks of real yield

Real yield plays an important role when considering a yield-generating opportunity. However, the term “real yield” can be used in a misleading way, enticing investors by using trustworthy terminologies that skirt the truth.

You may have heard of the following, “if you do not know where the yield comes from, you are the yield.” This saying is especially true when asserting whether a yield is real or not. 

When a yield is too good to be true, it can be because users’ funds are used to pay earlier investors in a Ponzi scheme or to amass unsustainable yield from other protocols, casino-style. Remember, yield can only be real if it can be verified to be so. Don’t trust, verify, as our Bitcoin friends like to say.

How does Orion deliver real yield?

To deliver real yield, Orion Protocol has carefully built a business and tokenomics model that brings sustainable yield into the DeFi space. 

To truly understand how Orion generates real yield, it is important to highlight the difference between Orion and other protocols. Orion is a CeDeFi exchange aggregator, meaning that centralized and decentralized exchanges are able to integrate with Orion’s platform. 

This, in turn, allows the protocol to offer an impressive selection of digital assets and liquidity pools while leveraging decentralized technologies to offer a truly complete DeFi trading experience.

While centralized exchanges (CEXs) keep transaction fees to themselves and are known to operate via opaque fund management operations, decentralized exchanges are often unsustainable. They can struggle from a lack of liquidity to achieve traction as viable long-term business models.

Orion Protocol stands out by having integrated the concept of real yield early in the design of the project’s fundamental business model.

Orion’s 18 streams of revenue and the ORN token

Orion has built a strong model aimed at generating over 18 streams of revenue. To develop each stream, Orion has put careful attention into the fundamental role of the ORN token. ORN is required to circulate for many of the basic operations of the platform, each of which can generate fees. These fees allow for the monetization of various features, including the Liquidity Boost Plugin, the Orion Terminal, and more. Orion also generates fees from licensing premium and enterprise-level features, and benefits from the sustainability of having a capped token supply that is designed to be deflationary.

Delivering sustainable real yield with Orion Protocol

DeFi participants should be aware of the difference between unsustainable and real yield to better assess opportunities. Identifying protocols that deliver sustainable yield from solid revenue streams is a significant step in the right direction.

Upon Main Net Staking, Orion Protocol will have the essential capabilities to distribute a healthy real yield to its users. With 18 streams of revenue supported by the circulation of ORN as a utility token on the Orion platform, Orion is leveraging a sound business and tokenomic model to create a viable, long-lasting CeDeFi aggregator. 

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