> For the complete documentation index, see [llms.txt](https://docs.foresure.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.foresure.xyz/chapter-6-tokenomics-usdfsr-the-liquidity-first-architecture/6.4-the-dual-utility-engine-collateral-and-recirculation.md).

# 6.4 The Dual Utility Engine: Collateral and Recirculation

Without the distractions of burn mechanisms, $FSR focuses on **High-Velocity Utility** within the Truth Engine:

**A. Oracle Staking and Truth Collateral:**\
Any entity wishing to resolve a market or verify an event must stake $FSR as collateral. This is not a "lock-up" in the traditional sense, but a functional requirement for the **Decentralized Witness Network**. Staked $FSR serves as a performance bond, ensuring that validators provide high-fidelity data.

**B. Protocol Reward Recirculation:**\
Instead of burning fees, Foresure implements a **Recirculation Model**. A 0.5% settlement fee is collected from winning trades.

* **Architect Rewards:** These fees are redistributed directly to the Liquidity Architects who provide the most accurate depth to the markets.
* **Governance Incentives:** Active participants who help resolve disputes and maintain the integrity of the protocol receive a share of the fees.
* **Yield Generation:** $FSR holders who support the protocol's stability through staking are rewarded with real yield generated from the protocol's actual trading activity.


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