Yield Guild

The foundational mechanism where members deposit capital (often in stablecoins or native tokens) into a shared treasury. This pooled capital is used to acquire and manage high-value, yield-generating assets like NFTs (e.g., playable game characters, virtual land) or liquidity provider (LP) positions. The treasury is typically managed via a multi-signature wallet or governed by DAO proposals.

A core operational feature where the guild lends its acquired assets (like game NFTs) to players, known as scholars, who may not have the capital to purchase them. The revenue generated (e.g., in-game tokens) is split according to a pre-defined, smart contract-enforced ratio between the scholar, the guild treasury, and guild managers. This enables permissionless participation and scales the guild's earning capacity.

Decision-making is decentralized through a governance token model. Token holders can vote on proposals that dictate the guild's operations, such as:

• Asset acquisition or sale
• Treasury fund allocation
• Adjusting scholarship split ratios
• Electing or compensating managers Voting power is proportional to token ownership, aligning incentives with the guild's success.

Guilds generate yield from multiple on-chain activities and distribute it to stakeholders. Common revenue streams include:

• In-game rewards and token farming from play-to-earn games.
• Staking rewards from DeFi protocols.
• Rental fees from asset lending.
• Capital gains from asset appreciation. Yield is automatically distributed via smart contracts to the treasury (for reinvestment) and to token holders/stakers as rewards.

Professional yield guilds implement strategies to mitigate key risks inherent in crypto markets and specific game economies. This includes:

• Asset diversification across multiple games or DeFi protocols.
• Smart contract audits for treasury and reward distribution systems.
• Slashing mechanisms for scholars who violate terms of service.
• Liquidity management to handle volatile token rewards and potential asset depreciation.

As guilds scale, they often spawn SubDAOs—smaller, specialized DAOs focused on a single game, asset class, or regional community. A SubDAO operates semi-autonomously under the main guild's umbrella, with its own treasury and governance for tactical decisions. This creates a modular, scalable structure that allows for focused expertise and localized management while benefiting from the parent guild's brand and infrastructure.

The core operational model where the guild owns high-value, yield-generating assets (like NFTs) and leases them to vetted players (scholars). The resulting rewards (e.g., in-game tokens) are split between the scholar, the guild treasury, and sometimes a manager. This model lowers the barrier to entry for players and provides a return on the guild's capital.

The guild's capital is held in a multi-signature wallet or DAO treasury. This pool is used to acquire and manage a diversified portfolio of assets, which may include:

• GameFi NFTs (Axie Infinity characters, land deeds)
• DeFi positions (liquidity provider tokens, staked assets)
• Governance tokens of other protocols Asset allocation and investment decisions are typically made via DAO governance proposals and votes.

Governance is decentralized through a native governance token (e.g., YGG's $YGG). Token holders can vote on proposals for treasury allocation, scholarship terms, and partnerships. The token often incorporates mechanisms like:

• Staking rewards for long-term holders
• Revenue sharing from guild profits
• Voting power proportional to stake This aligns incentives between the guild's management and its community of token-holding members.

To scale and specialize, top guilds often create or partner with Sub-DAOs. These are smaller, game-specific or region-specific guilds that operate semi-autonomously under the main guild's brand and treasury support. This structure allows for localized management, deeper game expertise, and risk diversification across multiple game economies and geographic regions.

Yield Guilds generate returns through multiple channels:

• Asset Appreciation: Capital gains from the rising value of owned NFTs and tokens.
• Yield Farming: Rewards from staking, lending, or providing liquidity in DeFi.
• Scholarship Revenue Share: A percentage of the in-game earnings generated by scholars.
• Protocol Incentives: Direct grants or token allocations from game studios for early adoption and community building.

Play-to-Earn (P2E): The economic model where gameplay directly yields cryptocurrency or NFT rewards. DAO (Decentralized Autonomous Organization): The legal and technical structure that enables member-owned, code-governed entities. NFT (Non-Fungible Token): The digital asset class representing in-game items, characters, or land. Staking: The process of locking tokens to secure a network or participate in governance, often for rewards.

The core operational mechanism of a Yield Guild, where the guild lends high-value gaming NFTs (like Axies) to players ("scholars") who cannot afford the upfront cost. Revenue from gameplay is split between the scholar, the guild, and a treasury.

• Key Roles: Guild (asset owner), Manager (supervisor), Scholar (player).
• Revenue Split: A typical split might be 70% to the scholar, 20% to the guild, 10% to the manager.
• Purpose: Lowers entry barriers and scales guild assets.

A smaller, specialized DAO operating under a main DAO's umbrella, often focused on a specific region or game. YGG uses SubDAOs to localize operations and decision-making.

• Purpose: Tailor strategies for specific geographic markets (e.g., YGG Philippines) or dedicated game verticals.
• Autonomy: Manages its own treasury, community, and scholarship programs within a broader framework.
• Scalability: Allows the main guild to expand efficiently into new ecosystems.

The economic design and mechanics of a project's native token. For YGG, this involves the utility, distribution, and incentives of the YGG token.

• Utilities: Governance rights, staking rewards, access to exclusive guild assets.
• Distribution: Allocated to investors, team, treasury, and community rewards.
• Incentive Alignment: Designed to reward long-term participation and stewardship of the guild.