As operative Projects generate revenue, which is collected monthly, it will be transferred to the Reserve smart contract. Income within the Reserve is meant to be used to maintain the Projects operation and to originate more Projects.
The Protocol spends its funds in the following way:
First, a portion of the income will be allocated into the Reserve’s maintenance and operation fund;
Secondly, the protocol will compensate for the Projects depreciation of the Projects within the Reserve;
A defined percentage of the net income will be allocated in the uWatt/USDT liquidity pool. This percentage is defined by governance and will be set initially to zero.
Finally, the remaining liquidity will be used to fund new Projects that are in the FUNDING state. The decision about which specific project to fund will be carried out by a voting-based system. According to this decision, the funds will be used to purchase pWatts of the Projects proportionally to the votes they acquired, and will be locked by the Project Milestones management contract, waiting for Milestones to be completed by the Installer company and hence originating new projects.
The portion of the funds used to fund new Projects will be used to acquire pWatts in FUNDING state on behalf of the Reserve. These pWatts will eventually become operational and get swapped by uWatts. These new uWatts will be automatically distributed among all the uWatt holders.