TREE Series (Seventeen): TREE Query Costs and Benefits
TREE tokens are not just for show in the Treehouse protocol; they directly connect query costs and ecological benefits, forming a self-sustaining cycle. In simple terms, users or referees wanting to access DOR data must pay with TREE, and this money is redistributed to participants, providing everyone with an incentive to maintain the system.
Let's first discuss query costs. As a decentralized interest rate benchmark, referees need to pay to access data when building financial products. TREE serves as the medium of payment, ensuring that costs are transparent and traceable on-chain. The fees are not paid in vain; they incentivize panel members to submit accurate predictions, avoiding garbage data. Delegators stake TREE to support the panel and can also share in the rewards. End users benefit indirectly because this makes DOR more reliable, leading to better lending or swapping tools.
How do the benefits come in? The fee routing design of TREE is clever. A portion of the fees rewards operators and the panel, while another portion goes to the treasury, supporting DAO bonuses and community projects. Users holding TREE can also participate in fee adjustments through governance, influencing the direction of the ecosystem. For example, tETH holders can earn extra profits from TREE's revenue sharing when arbitraging with DOR. The security of the protocol's cryptoeconomics relies on this, with TREE staking preventing cheating, and accurate predictions earning consensus rewards.
In real scenarios, TREE's query mechanism acts like an engine. Community airdrops and liquidity provision allow more people to hold TREE, increasing circulation. In the future, as DOR expands to L2 or multi-chain, the demand for queries will surge, and the value of TREE will rise correspondingly. This is not just a fee system; it is a cornerstone of sustainable development, allowing Treehouse to start from fixed income and radiate throughout DeFi.
Paying for queries with TREE is not a burden but an investment in the ecosystem. Holders benefit from it, and the more active the protocol, the richer the rewards.
