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RE: Where Does SURGE Yield Come From?

in LeoFinance16 days ago

Sorry, don´t get me wrong, I really want that this works, but
"designates a small portion of the initial capital raise to create a 6 month runway for dividend yield." sounds like a Ponzi scheme. With the incoming revenues you pay out the first buyers.
If you sell out all 500K SURGE, you will need to pay out 1442 HBD-equivalents per week. Market maker fees of 100$ won´t suffice for that.
"The Base Bridges for LSTR & SURGE with a1.5-2.5% per bridge", what is the volume there? Who needs this bridge by the way? I see no need to pay >1.5% on such a transaction.
Even if "LeoDex makes $1,000 USDC per day" it won´t be enough either to pay the SURGE yield.
In summary there are many "ifs" and all is dependent that the LEO ecosystem grows and grows. Have you calculated a scenario where all is flat? No growth, like in the Hive ecosystem? Is then the SURGE yield still sustainable? I am asking because there isn´t a permanent growth.

It is still impressive what you are doing, especially from the marketing/creativity aspect.

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Appreciate the thoughtful feedback 🙏

The key difference between SURGE and a Ponzi is how the yield and long-term engine are structured.

The 6-month runway isn’t used to “pay old investors with new ones” — it’s an on-chain buffer that ensures stability while real profit centers (market making, LeoDex USDC fees, bridge inflows, and LSTR growth) scale up.

The LeoStrategy fund currently holds ~3 million LEO (≈ $420K at $0.14/LEO) and accumulates more daily. Even if we never bought another token, a 50% annual appreciation in LEO’s price would add ~$210K USD to the balance sheet — enough to cover nearly 3 years of SURGE dividend obligations ($500K × $0.15 = $75K/year). That’s before counting any inflows.

Meanwhile, market making alone (currently only on LEO pairs) already earns about $100 USDC per day — ≈ $36.5K per year — covering nearly half of all SURGE dividends by itself. When LSTR + SURGE pairs go live cross-chain, that number should more than double.

Beyond that, several profit centers already exist or are being deployed:

  • @lstr.voter – an active, on-chain yield engine generating daily income for the fund.
  • sLEO Lending (coming soon) – a new profit center allowing collateralized lending against staked LEO, adding a sustainable revenue stream without selling tokens.
  • Dozens of upcoming products – all designed to use LeoStrategy’s balance sheet to generate yield without levering collateral — compounding the fund’s cash flow base.

Long-term, the thesis mirrors MicroStrategy’s: capture LEO’s volatility and long-term appreciation (targeting ~50%+ annual growth) while providing stable, yield-based exposure through SURGE.

Where we go even beyond microstrategy is with products/services and tools that generate hard inflows (cash flow) to the fund with minimal overhead