# Rewards

USDREFI uses [Merkl](https://merkl.xyz/) for reward distribution. Merkl is a production-grade off-chain computation / on-chain claim system that distributes rewards pro-rata to qualifying holders without requiring staking or lock-ups.

## How It Works

1. The Reward Safe deposits USDREFI + $REFI into a Merkl campaign at a fixed % rate set by the Foundation
2. Merkl takes periodic snapshots of qualifying USDREFI balances
3. Merkl computes pro-rata shares and builds a Merkle tree
4. The Merkle root is published on-chain
5. Users claim their rewards by submitting a proof — no gas-heavy distribution transactions needed

## Holder Rewards

USDREFI holders earn rewards simply by holding tokens in their wallet. No staking required.

**Eligibility filtering:** Merkl excludes the Uniswap pool contract address from holder reward calculations. Only tokens held in user wallets and allowlisted Safes earn holder rewards. This prevents double-counting tokens that are providing liquidity.

## LP Incentives (Separate)

Liquidity providers on the Uniswap V4 USDREFI/USDC pool are rewarded through a **separate** Merkl campaign or $REFI gauge, independent of holder rewards. This is critical because the pool is the sole exit mechanism — incentives must be attractive enough to maintain sufficient depth.

## Reward Parameters

| Parameter            | Value                                       |
| -------------------- | ------------------------------------------- |
| Reward rate          | Fixed % (set by Foundation Safe)            |
| Reward tokens        | USDREFI + $REFI                             |
| Holder eligibility   | EOAs + allowlisted Safes                    |
| LP eligibility       | Uniswap V4 LP positions (separate campaign) |
| Claim mechanism      | Merkle proof (on-chain)                     |
| Distribution cadence | Monthly                                     |

## Claiming & Compounding

Users can claim rewards at any time via the frontend at `app.regenerative.fi/usdrefi`. The claim modal shows your claimable USDREFI and $REFI balances, and executes a Merkl claim transaction with the appropriate Merkle proof.

A **compound option** is available: claim USDREFI rewards and immediately re-deposit them into the vault in a single flow, increasing your position without additional USDC.