> For the complete documentation index, see [llms.txt](https://shihu.gitbook.io/shihu-whitepaper/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://shihu.gitbook.io/shihu-whitepaper/the-origin/how-it-works.md).

# How it works

<figure><img src="/files/K69Rc3eyfdOxz8OhWzzh" alt=""><figcaption></figcaption></figure>

#### Fundraising for Tokens

**Shihu Protocol** facilitates fundraising through a structured sale mechanism consisting of two rounds:

* **Whitelist Community Round** (Optional for Creators): 30% of the total raise. Creators decide who to invite to this round and manually input the whitelist community wallets, allowing specific users to participate.
* **Public Round** (First-Come, First-Served - FCFS): Open to the public, allowing anyone to participate in the fundraising process at the same price.

#### Fund Allocation

Upon completion of the fundraising process, the BNB collected will be allocated as follows:

* **65%:** Automatically added as liquidity on an Automated Market Maker (AMM), specifically PancakeSwap, ensuring token stability and accessibility.
* **30%:** Allocated to the Developer Fund (Dev Fund) for project development, covering operational costs, marketing, and ecosystem expansion.
* **5%:** Fee for Shihu Protocol.

#### Trading (Successful Raised)

Once the fundraising is successfully completed, the token supply will be distributed as follows:

* **39.4%:** Used to provide liquidity on PancakeSwap to facilitate seamless trading.
* **60.6%:** Distributed to users who participated in the fundraising process.

#### Failed Launch Case

If the funding goal doesn’t reach **soft cap**, the process is reversed, and users are refunded.


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