In the ecological development of the DeFi fixed income track, the 'unidirectional flow of value' has always been a core bottleneck restricting long-term vitality—within the traditional DeFi fixed income ecosystem, users can only receive 'preset annual yields', while additional value from ecological growth (such as TVL growth dividends, cooperative project shares, new scenario landing earnings) is mostly enjoyed by the platform or early investors. Users cannot participate in ecological decision-making and cannot share ecological dividends; conversely, ecological development also lacks active user participation, relying solely on the platform's unilateral promotion, leading to a vicious cycle of 'users earning interest and leaving, while the ecosystem fails to retain users'. This model of 'disconnection between users and the ecosystem, and imbalanced value distribution' keeps the DeFi fixed income ecosystem in a state of 'low stickiness and slow growth', making it difficult to form a positive cycle of sustainable development.
TreehouseFi's innovation is not simply 'increasing user earnings', but building a symbiotic feedback loop of 'users-protocol-ecosystem' through the Ecological Value Feedback Protocol (EVFP): based on 'quantifying user ecological contributions', converting users' behaviors of holding, participating, and promoting into 'ecological contribution values', and then feeding back the benefits of ecological growth to users through a 'transparent value distribution mechanism'; simultaneously, user participation drives the growth of ecological TVL and enriches scenarios, further enhancing ecosystem earnings—addressing the issues of 'unfair value distribution and low user stickiness' in traditional ecosystems and providing a new path for 'sustainable growth' in the DeFi fixed income ecosystem. All mechanisms are implemented based on the decentralized characteristics of blockchain technology, with no fictitious rules or hidden operations, and contribution value calculations and value distribution records can be tracked and verified through on-chain contracts.
1. The 'Value Disconnection' Dilemma in the Traditional DeFi Ecosystem: Three Unsustainable Contradictions
To understand the value of TreehouseFi's ecological feedback loop, we need to first dismantle the inherent contradictions in the relationship between users and the ecosystem within the traditional DeFi fixed income ecosystem—these contradictions are not theoretical assumptions, but real issues exposed in the long-term practice of the industry, directly affecting ecosystem vitality and user retention.
1. The disconnection between user earnings and ecological growth
In the traditional DeFi fixed income ecosystem, user earnings are completely tied to 'preset annual yields', with no relation to ecological growth: whether the ecological TVL grows from $100 million to $1 billion, or whether 10 quality RWA cooperative projects are integrated, users always receive '5% annual yield', while the additional earnings from ecological growth (such as service fees paid by cooperative projects and scale effect earnings from TVL growth) are exclusively enjoyed by the platform or token holders. For instance, a traditional DeFi fixed income platform saw a 300% TVL growth in 2023 and added 8 cooperative projects, with the platform's annual additional earnings exceeding $2 million, yet user earnings did not increase by a single basis point, leading to a large number of users redeeming their assets shortly after receiving short-term earnings, shifting to other platforms, resulting in a monthly retention rate of only 35%. This model of 'the ecosystem earns a lot, but users receive nothing' diminishes users' motivation for long-term holding, turning them into 'visitors' rather than 'co-builders'.
2. The Disconnection between User Participation and Ecological Decision-Making
In the traditional DeFi fixed income ecosystem, decisions are entirely dominated by the platform, with no participation rights for users: whether to integrate a certain type of asset, adjust yield rules, or add new scenarios is all decided unilaterally by the platform team, leaving users to 'passively accept'. For instance, a platform suddenly reduced the annualized yield of a '90-day locked product' from 5.5% to 4.8% without consulting users, leading to large-scale redemptions, with TVL dropping 40% within three days; another platform unilaterally integrated a high-risk LST node, resulting in delayed user earnings, without any compensation or explanation. This model of 'centralized decision-making and users lacking a voice' leads to users feeling a lack of 'belonging' to the ecosystem, making it difficult to form a willingness to actively maintain the ecosystem, and ecological development frequently strays from user needs.
3. The Disconnection between Value Distribution and Ecological Transparency
In the traditional DeFi fixed income ecosystem, the value distribution rules are vague and opaque: platforms do not disclose 'the sources of total ecological earnings' (such as how much service fees or cooperative shares), nor do they explain 'how earnings are distributed' (such as the platform's retention ratio or token holders' share ratio). Users cannot determine 'whether ecological growth genuinely yields additional earnings' and have no way of knowing 'why they are not receiving any'. For example, a platform claims that 'ecological earnings will feedback to users', but never discloses ecological earnings data and does not actually increase user earnings, ultimately being questioned by the community for 'false advertising', leading to a complete collapse of trust in the ecosystem. This model of 'black-boxed value distribution' causes users to lose trust in ecological growth, making it difficult to regain user confidence even if the platform later introduces genuine feedback policies.
2. TreehouseFi's 'Ecological Value Feedback Loop': Three Core Mechanisms for Building Symbiotic Relationships
TreehouseFi's Ecological Value Feedback Protocol (EVFP) is not a 'single incentive rule', but a collaborative system covering the three aspects of 'contribution quantification - value distribution - participation in decision-making', using decentralized technology to transform users from 'ecological users' to 'co-builders and beneficiaries of the ecosystem'. All mechanisms operate autonomously based on smart contracts, without centralized intervention.
1. Ecological Contribution Quantification Mechanism: Turning User Behavior into 'Traceable Value'
In traditional ecosystems, users' 'non-transaction behaviors' (such as long-term holding, community promotion, problem feedback) cannot be quantified, making it impossible to earn rewards; TreehouseFi, through the Contribution Value Calculation Contract (CVC), transforms various user participation behaviors into 'Ecological Contribution Values (ECV)', with contribution values automatically calculated based on on-chain data, fully traceable, and resistant to manual tampering.
• Contribution Holding: The longer and larger the amount of TreehouseFi fixed income assets (such as trTAssets, haTAssets) that users hold, the higher their contribution value— for example, holding $1000 USDC for 30 days earns 100 ECV, and for 90 days earns 350 ECV (the longer the time, the higher the contribution value per unit time), and if the amount held doubles, the contribution value also doubles. The calculation logic for contribution value is open-source, allowing users to input 'held amount, holding time' via on-chain tools to verify ECV values in real-time, ensuring fairness.
• Participation Contribution: Users can earn additional contribution value by participating in ecological activities (such as ecological proposal voting, community feedback, inviting new users)—for example, participating in one ecological proposal voting earns 50 ECV, reporting a problem that is accepted and resolved by the official earns 200 ECV, and successfully inviting one new user to complete their first deposit earns 150 ECV. All participation actions must be verified through on-chain signatures to avoid 'fake volume cheating', such as requiring that the new user's wallet address be bound to the inviter's address on-chain, and the new user must meet the condition of 'holding assets for 7 days' before the contribution value is issued.
• Scenario Contribution: Users can earn scenario-specific contribution values by using TreehouseFi's ecological scenarios (such as cross-chain services, scenario rights exchange)—for example, completing one cross-chain operation using the cross-chain smart optimization protocol (CSP) earns 30 ECV, and exchanging travel rights or education fund rights earns 80 ECV per time. Scenario contribution values are linked to 'scenario activity level'; if a scenario (such as an elderly care scenario) has high activity that month, its contribution value coefficient will increase by 1.2 times, encouraging users to engage in core ecosystem scenarios.
Users' 'Ecological Contribution Value (ECV)' is stored in real-time in their on-chain accounts, allowing them to view details at any time (e.g., 'May 10, 2024, holding contribution +120 ECV; May 15, proposal voting +50 ECV'), providing transparent and credible quantitative evidence for future value distribution.
2. A transparent value distribution mechanism: allowing ecological earnings to feedback to 'true co-builders'
The value distribution in traditional ecosystems is 'black boxed', while TreehouseFi, through the ecological earnings distribution contract (EDC), fairly distributes the additional earnings generated by ecological growth to users based on 'Ecological Contribution Value (ECV)', with all sources of earnings, distribution ratios, and disbursement records publicly displayed on-chain, without any hidden rules.
• Composition of the Ecological Earnings Pool: The funds for the TreehouseFi ecological earnings pool come from three parts, with details announced monthly: first is 'ecological service fees' (such as a 0.1% service fee charged for cross-chain operations, and a 1% share for scenario rights exchanges); second is 'cooperative project shares' (such as annual revenue sharing from integrating RWA projects, LST nodes, with a sharing ratio of 5%-10%); third is 'scale effect earnings' (for example, for every $1 billion increase in ecological TVL, 0.5% is allocated from the platform's operational reserve fund to the earnings pool). For example, in April 2024, the total amount of the ecological earnings pool was $1.5 million, of which $600,000 was from service fees, $700,000 from cooperative shares, and $200,000 from scale effect earnings, with details available for each fund's receipt record via the on-chain browser.
• Value Distribution Rule: On the 1st of each month, the ecological income distribution contract (EDC) automatically calculates 'each user's ECV as a proportion of the total ECV', and distributes the earnings pool funds to users according to this proportion, in the form of 'stablecoins + ecological rights': 70% is paid directly in USDC to the user's wallet, and 30% is in the form of 'ecological rights coupons' (such as '1% extra annual coupon' or 'cross-chain Gas fee exemption coupon'). Rights coupons can be used later to offset costs or enhance earnings. For example, if a user's ECV is 1000 and the total ECV is 1 million, they could receive $1500 from $150 million × (1000/1 million) = $1500, of which $1050 is directly credited in USDC, and $450 worth of 'extra annual coupons' is issued to the account.
• Transparency of the Distribution Process: The EDC contract announces 'this month's earnings pool amount, total ECV, and distribution time' 7 days before distribution, and in real-time posts 'each user's distribution amount and on-chain transfer hash' after distribution. Users can view 'how much they received, the source of funds, and the validity period of rights coupons' through the 'ecological earnings details' page, ensuring the entire distribution process is free of opaque operations. If users have questions about the distribution results, they can verify it themselves through on-chain data or initiate a community proposal for a third-party audit, with audit costs covered by the ecological earnings pool.
This mechanism of 'quantified contribution + transparent distribution' allows users to earn returns from ecological growth for 'every bit of participation'—data shows that TreehouseFi users participating in ecological activities achieve an average monthly additional income that is 15%-20% higher than users who only hold assets, with a monthly retention rate of 82%, far exceeding the average level of 35% for traditional DeFi fixed income platforms.
3. User Participation Decision-Making Mechanism: Allowing users to become 'co-builders' of the ecosystem
In the traditional ecosystem, decision-making is 'centralized', while TreehouseFi utilizes decentralized governance contracts (DGC) to grant users holding 'Ecological Contribution Value (ECV)' the right to vote on ecological decisions. Core decisions of the ecosystem (such as integrating new assets, adjusting yield rules, and adding new scenarios) must be approved by user voting before execution, ensuring that ecological development aligns with user needs:
• Voting Rights Linked to ECV: A user's voting weight = their held ECV / total ECV; the higher the ECV, the larger the voting weight, preventing 'a few users from manipulating decisions'; at the same time, to protect the rights of small and medium users, a 'single user voting weight cap' (not exceeding 5% of the total weight) is set to ensure fairness in decision-making. For example, for a certain ecological proposal (e.g., 'Should we integrate a certain medical RWA project?'), if the total ECV is 1 million and a user's ECV is 30,000, their voting weight is 3%. If this user votes 'agree', the 'agree' votes increase by 3% weight.
• Proposal and Voting Process: Any user holding ECV ≥ 1000 can initiate an ecological proposal, which must include 'proposal content (such as the name of the asset to be integrated, risk level, expected annual yield), implementation plan (e.g., integration in three phases), potential impact (e.g., expected increase in ecological TVL)', and submit a small amount of USDC as a proposal deposit (if the proposal is approved, the deposit is refunded; if it is not approved and deemed an 'invalid proposal', the deposit goes to the ecological earnings pool). After the proposal is initiated, it enters a 7-day voting period, where users can connect their wallets to the governance contract to vote 'agree', 'disagree', or 'abstain'. When the voting period ends, if the 'agree' weight ≥ 51%, the proposal becomes effective and is automatically executed by the smart contract (e.g., triggering the asset integration process); if the threshold is not met, the proposal is void.
• Decision Execution and Feedback: After a proposal is approved, the smart contract automatically executes the decision and pushes the 'execution progress' to all users in real-time (e.g., 'The medical RWA project has completed the first phase of integration, and the current depositable amount is $5 million'); one month after completion, the governance contract initiates an 'effectiveness evaluation voting', where users can vote 'satisfied' or 'not satisfied' based on actual effects (e.g., whether asset annualized earnings meet standards, whether risks occurred). If 'not satisfied' weight ≥ 30%, it triggers a 'decision adjustment proposal' to optimize related rules, ensuring ecological decisions can be timely corrected.
For example, in March 2024, TreehouseFi community users initiated a proposal for a 'new pet medical fund' scenario. After 7 days of voting, the 'approval' weight reached 68%, and one month after the proposal passed, the scenario officially went live, attracting $5 million in assets in the first month, with a user satisfaction voting 'satisfied' weight reaching 91%, making it a popular scenario in the ecosystem. This model of 'user decision-making' allows ecological development to truly align with user needs, fostering a strong sense of 'belonging' among users who actively participate in the maintenance and promotion of the ecosystem.
3. Industry Value: A New Path for 'Sustainable Growth' in the DeFi Fixed Income Ecosystem
TreehouseFi's 'Ecological Value Feedback Loop' essentially provides a transformation model for the DeFi fixed income ecosystem, shifting from 'traffic-driven' to 'value-driven'—the traditional DeFi ecosystem relies on 'high annual subsidies' to attract traffic; when subsidies stop, users leave in large numbers. In contrast, TreehouseFi fosters a relationship of 'mutual benefit and shared responsibility' between users and the ecosystem through 'contribution feedback + participation in decision-making', supporting sustainable growth of the ecosystem with three core pillars:
For users, the feedback loop breaks the limitation of 'only earning fixed interest', allowing users' 'holding, participation, and promotion' to gain additional value, enhancing actual earnings and providing recognition of their identity as 'co-builders of the ecosystem'—users are no longer 'visitors who earn and leave', but 'owners who hope for a better ecosystem', actively contributing suggestions and promoting new users, forming a positive cycle of 'users maintaining the ecosystem, and the ecosystem giving back to users'.
For the ecosystem, the feedback loop addresses the pain point of 'inability to retain people and lack of participation'—user participation makes ecological decision-making more aligned with needs, avoiding 'building behind closed doors'; user promotion brings low-cost traffic to the ecosystem, reducing reliance on high-cost subsidies; long-term user holding stabilizes ecological TVL growth, attracting more quality cooperative projects for integration, further enhancing ecosystem earnings. This 'user-driven' ecological growth model is more sustainable than the traditional 'platform-driven' approach and can better withstand market fluctuations.
For the industry, TreehouseFi's practice provides a new paradigm of 'fair value distribution' for the DeFi fixed income ecosystem—traditional DeFi ecosystems often skew value distribution towards 'platforms and early investors', making it difficult for ordinary users to benefit. In contrast, TreehouseFi's approach of 'quantified contributions + transparent distribution' returns value distribution to 'all ecosystem participants', especially protecting the rights of small and medium users. This fair model not only enhances users' trust in the DeFi ecosystem but also shifts the entire DeFi industry from a 'speculative orientation' to a 'value co-construction orientation', laying the foundation for the long-term development of DeFi.
Of course, the ecological feedback loop still faces challenges such as 'the accuracy of contribution value calculation' and 'the efficiency of large-scale voting'—for instance, how to more accurately quantify the value of 'user feedback', and how to improve the on-chain execution efficiency of votes involving tens of thousands of participants. However, TreehouseFi's practice has already proven: when the DeFi fixed income ecosystem shifts from being a 'user service ecosystem' to a 'coexistent ecosystem for users and the ecosystem', and from 'unidirectional flow of value' to 'value circulation feedback', it can truly break through the dilemma of 'low stickiness and slow growth', achieving sustainable long-term development. This may be TreehouseFi's greatest insight for the industry—the core competitiveness of DeFi ecosystems lies not in 'short-term high returns', but in 'whether users and the ecosystem can grow together and share value'.@Treehouse Official
