# Tokens Structure

The tokenomics model is centered on the dynamic interplay between **$NIT** and **Reward Tokens** (xNIT, Nitro point), creating an infinite reward cycle that ensures **$NIT’s** value stability and supports long-term sustainability.

<figure><img src="/files/WL3EN0poQpLOw8ZK4D95" alt="" width="563"><figcaption></figcaption></figure>

## **Tokens**

### **$NIT:**

$NIT serves as the native token of the protocol. At the DAO’s inception, $NIT holders will govern essential parameters, including:

* Deploying new trading pairs using the token reserve balance.
* Allocating DAO grants to support ecosystem expansion.
* Adjusting market parameters or disabling borrowing for specific pairs.

### Reward Tokens

* **Nitro Points** are non-transferable reward tokens designed to incentivize platform engagement. They are earned through interactions such as liquidity provisioning, borrowing, and blacklisting of expired debts.
* **xNIT** are earned through the conversion Nitro Points, and they can be converted into $NIT via the rewards contract. For more details, [<mark style="color:purple;">\[click here to learn more\].</mark>](/ftl/nitronomics/nitro-point-xnit.md)

{% hint style="success" %}
**Fee Distribution**

* **Liquidity Providers (75%)**
  * 75% of transaction fees are directed to liquidity providers, rewarding them for swaps, borrowing, and other interactions.
* **Treasury Fee Reserve (25%)**
  * 25% of transaction fees are reserved for:
    * Platform development and expansion.
    * $NIT buybacks, reducing token supply and enhancing scarcity.
    * Increasing xNIT backing in the reward contract to sustain long-term rewards.
      {% endhint %}


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