Settlement Reference

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This page gives more detail about Settle. It explains delivery responsibility, price limits, and the effect of changes in reserve size.

//The instruction is fixed at submission close

The protocol uses the submitted stakes to calculate the target reserve mix. It then calculates the new assets needed to reach that target.

The system position represents the existing reserve mix. It has no delivery responsibility because the reserve already holds its assets.

Proposer stakes can also match part of the existing mix. That part needs no new delivery. The protocol assigns the remaining purchase instructions to the relevant proposers.

Each position receives a maximum delivery responsibility when submissions close. Later public purchases reduce the amount due.

The protocol records these limits relative to the reserve size at announcement. This lets it account for later proportional minting and redemption.

//Delivery is netted per account

One account can stake on several tokens. The protocol identifies the part of those stakes that matches the current reserve mix.

This matching part has no delivery responsibility. The remaining stake determines the account's share of each token instruction.

For example, an account that supports the current reserve mix in exactly the same proportions needs no new assets. An account that supports a new token can have a delivery responsibility for that token.

A later submission can change an account's responsibility before submissions close. It does not unlock an earlier stake.

//Public sellers act first

A public filler is a seller who supplies assets during the public auction. Each token has its own quote and remaining quantity.

Quote limits

The quote depends on elapsed auction time and valid current prices. It starts at zero and increases toward the current price plus the allowed markup.

The protocol also sets a price ceiling from the fixed reference price. It pauses purchases when the quote exceeds that ceiling. It does not replace an excessive quote with the ceiling price.

Invalid or stale oracle data also pauses purchases. Public purchases require valid current data. A pause does not restart the auction clock or extend the deadline.

The auction can finish with an unfilled instruction. A price ceiling limits payment, but it cannot create market liquidity.

Each fill reduces one residual

The residual is the amount that remains after public purchases. A purchase of token A reduces only token A's residual.

The protocol accounts for proportional minting and redemption when it records each purchase. Sellers cannot supply more than the remaining instruction allows at the current reserve size.

Optional basket payment

The settlement design also permits payment with a proportional share of reserve assets instead of new SRT.

This payment must leave the same backing per SRT as the corresponding payment with new SRT. All parts of the trade must succeed together. Rounding favors the reserve.

This option changes the payment method. It does not change the target mix or the competition's reference prices.

//Proposers deliver the residual

After public purchases close, proposers share their token's residual according to their delivery responsibility. Public purchases reduce each affected position's responsibility in the same proportion.

For tokens with the required oracle quality, the delivery rate uses the lower of the reference price and a valid current price. The allowed markup then applies. Other cases use the announced ceiling.

This rule determines payment for delivered assets. It does not select a lower competition entry price. All positions on the same token retain that competition's fixed reference price.

Changes in reserve size

Proportional SRT minting can increase the physical amount due. Proportional redemption can decrease it.

The expansion limit caps the increase that a proposer accepts. Public sellers have no future obligation, so their voluntary purchases can follow the current reserve size.

A smaller reserve does not erase the recorded responsibility. The protocol converts that responsibility into the physical amount due at the current scale.

Incomplete delivery

The protocol compares the undelivered amount with the position's full responsibility fixed at submission close. Public purchases count toward completion.

The corresponding share of stake loses reward eligibility. The announced confiscation rule determines how much of that share moves to the system position. The rest becomes available for the proposer to reclaim.

One proposer's failure cannot increase another proposer's delivery responsibility. It can change the reward shares because the eligible stakes have changed.

//Settlement bounds

The volume limit restricts the competition's planned reserve change. The price ceiling restricts payment for each incoming asset. The expansion limit restricts increases in proposer responsibility.

These limits serve different purposes. A limit recorded at announcement is not a fixed limit on all SRT issuance after the reserve grows.

Settlement can change backing per SRT. Its limits do not protect holders from later market losses or guarantee an SRT market price.

Token amounts use whole units of the token's smallest denomination. Rounding can leave small amounts in the reserve or reward contract.

The basic reward calculation is on Redistribute. The configurable limits are on Parameters.