# Protocol Revenue

The protocol currently generates revenue from two primary sources:

1. **10% Performance Fee**\
   Torch Finance charges a 10% performance fee on rewards earned from deploying capital into various external strategies. These earnings are allocated to the protocol’s reserve fund to enhance stability and support long-term sustainability.
2. **Liquidity Premium During Redemption Cooldown**\
   When users redeem their tgUSD, they must wait through a cooldown period (currently set at 14 days). This delay allows the protocol sufficient time to withdraw funds from external protocols (see [Purpose of the Cooldown Period](/telegram-usd/how-tgusd-works/architecture/core-components/engine.md#purpose-of-the-cooldown-period) section). If there is no liquidity crunch and the withdrawal is successful, the interest accrued during the remaining cooldown period is retained by the protocol as additional income.


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