⚡️Many people overlook a seemingly insignificant but solid point when looking at Spark—

The issued USDS is continuously and steadily generating cash flow.

Currently, in @sparkdotfi's TVL, USDS accounts for about 68% as a core income asset, generating approximately $40,000 in revenue daily, which is essentially the cash engine of the entire system.

1⃣ The first and most core part comes from Spark Savings.

The asset side is around 5.4%, the liability side is 4%, and the interest margin of about 1.4% is the profit space that the system has long-term.

2⃣ The second part comes from the lending market of SparkLend, which has a smaller profit share.

This brings up a topic that has been discussed a lot recently—

The head of the Ethereum Foundation recently mentioned that the lending income from Ethereum and L2 now accounts for about 90% of the entire crypto market's income.

Many people instinctively think that since 90% of the income in the Ethereum ecosystem comes from lending, the protocols must constantly amplify risks and increase leverage to make money.

But I believe that is not the case:

The so-called "90% of income comes from lending" actually points to interest rates, not risks, which aligns with what Vitalik Buterin (@VitalikButerin) advocates as Low-Risk DeFi.

The same is true in traditional finance:

The largest source of income for banks also comes from lending, but the most profitable and stable part has never been high-risk loans, but rather the interest margin between deposits and loans, along with the funding efficiency of large-scale low-risk assets.

Thus, it can be understood that Spark's main income does not come from high-interest speculation in the frontline lending market, but rather from the scaled operation of USDS—

It serves as a layer of on-chain basic liabilities, continuously participating in the operation of the entire interest rate system.

Spark Savings essentially still belongs to the lending system, just positioned at the very top with the lowest risk;

Users deposit U and receive a guaranteed return of 4%; while Spark deploys these USDS into more efficient yet still low-risk interest rate scenarios through SLL.

This is actually highly consistent with the overall income structure of the Ethereum ecosystem!

Data dashboard: https://info.sky.money/

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