# Yield and Economics

All USDREFI yield comes from real-world regenerative lending. There is no leverage, no DeFi composability risk, and no synthetic yield.

## Yield Sources

### Quipu via Textile (v1 — Launch)

The initial yield source is Quipu, a Colombian AI-powered microcredit originator that has disbursed over 49,400 loans using 80,000+ alternative data points. Capital is deployed through Textile's smart contract infrastructure.

### EthicHub (v1 — Phase 2)

EthicHub provides long-duration loans (12–24 months) to smallholder farmers and cooperatives. It generates USD-denominated yield plus upside from EthicHub's ETHIX ecosystem token. EthicHub has an established track record and meets the Credit Curation Framework standards.

### Expansion

As new originators pass through the [Credit Curation Framework](file:///2028660/framework/overview.md), the USDREFI basket will diversify into regenerative agriculture, renewable energy, micro-enterprise, and similar sectors. Every addition must clear all five gates.

## Yield Economics

| Metric                       | Value                                             |
| ---------------------------- | ------------------------------------------------- |
| EthicHub Gross Yield (12-mo) | \~10% (8% USD + \~2% ETHIX)                       |
| EthicHub Gross Yield (24-mo) | \~13% (8% USD + \~5% ETHIX)                       |
| User Yield Target            | \~4% APY in USD (comparable to sDAI/Spark)        |
| Surplus                      | Retained to build protocol-owned liquidity        |
| Ops & Infra                  | \~$20–25k/year (lean human ops + minimal tooling) |

## How Yield Reaches You

Yield does **not** accrue into the USDREFI share price (the exchange rate stays 1:1). Instead, rewards are distributed as a side-stream via Merkl campaigns:

1. Curated lending sources generate yield monthly
2. The Foundation Safe receives yield and transfers the reward portion to the Reward Safe
3. The Reward Safe funds a Merkl campaign with USDREFI + $REFI tokens
4. Merkl snapshots holder balances and builds a Merkle tree
5. You claim your pro-rata share on-demand via on-chain proof

This design keeps the vault simple and ERC-4626 compliant while providing transparent, claimable rewards.