> For the complete documentation index, see [llms.txt](https://whitepaper.usegpu.app/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://whitepaper.usegpu.app/reward-economics/volume-scenarios/yield-assumptions.md).

# Yield Assumptions

Understand the assumptions behind the 25% annual yield break-even scenario and why the resulting figures are not guaranteed returns.

The source models a trading-volume scenario that corresponds to a 25% annualized yield under defined assumptions. It is an analytical scenario, not a protocol commitment.

### Assumptions

| Category                       | Assumption                    |        Value |
| ------------------------------ | ----------------------------- | -----------: |
| Portfolio assumption           | Lockup value                  |   $1,000,000 |
| Portfolio assumption           | Supply locked                 |          10% |
| Analytical target              | Annualized yield              |          25% |
| Source-defined market scenario | Approximate break-even volume | $120,000/day |
| Protocol parameter             | Creator-fee rate              |        0.30% |
| Protocol parameter             | Mining allocation             |          35% |

The supply-locked percentage and lockup value define the modeled participant base. The annualized yield is a target within the scenario. Trading volume remains market-dependent.

### Annualized reward requirement

The target converts to a required annual and daily reward amount:

$$
\text{Implied Annual Reward} = $1{,}000{,}000 \times 25% = $250{,}000 \text{/year}
$$

$$
\text{Implied Daily Reward Requirement} = $250{,}000 \div 365 \approx $684.93 \text{/day}
$$

These values describe the scenario's analytical requirement. They do not define a minimum payout or a guaranteed outcome.

### Source-defined break-even volume

The source defines approximately `$120,000/day` as the break-even volume scenario. Under the stated creator-fee and mining-allocation inputs, the direct fee calculation is:

$$
\text{Creator Fee Revenue} = $120{,}000 \times 0.30% = $360 \text{/day}
$$

$$
\text{Daily Mining Pool} = $360 \times 35% = $126 \text{/day}
$$

The `$126/day` direct Mining Pool calculation does not, by itself, equal the `$684.93/day` analytical reward requirement. The v0.1 economics state the `$120,000/day` break-even figure without sufficient inputs to fully derive that relationship.

Accordingly, `$120,000/day` remains a source-defined modeled scenario. The direct fee calculation remains a separate, traceable result from the stated 0.30% and 35% parameters.

### Interpreting the scenario

Within the source-defined scenario:

* Below the modeled volume, the annualized outcome would be below the 25% target
* Above the modeled volume, the annualized outcome would be above the 25% target
* Both outcomes depend on the stated portfolio assumptions and market-driven trading volume

Annualized yield is a derived analytical metric. It does not guarantee a payout, establish a reward floor, or predict trading volume.

### Inputs that remain variable

The scenario depends on several values that can change:

| Input                          | Effect on the result                         |
| ------------------------------ | -------------------------------------------- |
| Trading volume                 | Changes creator-fee and Mining Pool revenue  |
| Total Mining Power             | Changes each miner's proportional pool share |
| Miner Mining Power             | Changes the miner's proportional pool share  |
| Lockup value and supply locked | Define the scenario's annualized-yield basis |

The current calculation covers creator-fee revenue. It does not include future GPU rental or inference revenue because no numerical assumptions are defined for those sources.


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