Many people might be confused by last week's CAKE data — a total profit of 6 million, net profit of 2 million, but a burn of only $854,000. At an 8% burn rate, it should only be around 480,000. What's going on?

Actually, there are two logical frameworks at play.

**First is that the return ratio is not fixed.** The LP's return share fluctuates between 66% and 84%, the burn rate varies between 8% and 23%, and the treasury share is between 8% and 19%. All of these depend on the fee structure of different pools. So, it's not simply a matter of fixed ratios.

**The key is the mechanism of the burn wallet.** This is why many people get the calculations wrong — the burn wallet is never emptied all at once, but only 50% of its contents are burned each time. For example, if this week the profit is 10 million, and the burn wallet has 15 million, only 7.5 million will be burned. Next week, if the wallet has 12.5 million left, only 6.25 million will be burned. And so on. This progressive burn design causes many to have skewed expectations about the amounts.

Finally, to clarify: that 6 million is indeed all earned by the platform, with 84% returned to LPs, but the remaining treasury earnings and burn portions are also real income. This is not generated out of thin air but is a normal distribution under the platform's business model.