> For the complete documentation index, see [llms.txt](https://doortoken.gitbook.io/nil-help/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://doortoken.gitbook.io/nil-help/nil-coin/token-reflection.md).

# Token Reflection

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Reflections are distributed real-time every time a transfer is made to all existing holders pro-rata.
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> ### Every time someone buys or sells, 5% of the transaction is distributed to all holders. 

Traditional mining is both costly and inconvenient for the user. Frictionless, static reflection rewards accrue by simply holding your tokens, and features an innovative hold-farming reward structure that stands out from conventional pool-farming rewards. The idea behind this function is to eliminate token dependencies that have created problems in the past, including, but not limited to:

1. Pooling funds in unverified 3rd party smart contracts;
2. External website interfaces;
3. Transaction fees needed to claim rewards.

Earlier models of decentralized finance tokens such as pool farming are costly and rely on user action to manually compound rewards. As a solution, we propose the utilisation of a compounding reward structure that requires no additional fees in a smart contract function, also known as token reflections. To achieve this, reflection must happen without cost or impact to the user. Considering the static rate of reflection set at 5%, the volume of market activity will directly impact the quantity of token reflection based upon the percentage of tokens held by the user relative to the overall supply.