@charlotteaug

Profit-sharing tokens require careful cash flow simulations. Assumptions should include projected user growth, fee structures, retention rates, and cost leakage. A base model can apply historical fee capture ratios from similar protocols. Growth scenarios (low, base, high) allow sensitivity testing. Cash flows are discounted with rates adjusted for governance and sector volatility. Importantly, payout mechanisms must be audited to ensure feasibility. By simulating profit distribution under multiple adoption curves, investors can approximate sustainable yields. Transparent, automated fee-sharing strengthens credibility, while discretionary models warrant valuation haircuts.

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