Source: [Stake](https://sapio.network/docs/stake)

# Stake

Proposers lock stake behind tokens they want the reserve to acquire. The system also stakes behind the reserve's current composition. Their combined stakes define the competition's target.

## Fixed reference prices

At announcement, Sapio fixes the eligible tokens, parameters, and reference prices for the competition.

Each token has one fixed reference price. Every position on that token uses that price throughout the competition. Early and late submissions use the same reference price.

For example, a token's fixed reference price can be 100 SRT. Both early and late submissions use 100 SRT for that competition.

Purchase prices and delivery prices do not change the fixed reference price. Later oracle checkpoint prices measure performance against it. [Redistribute](https://sapio.network/docs/redistribute.md) explains the score.

## The system position

The system enters with SAPIO stake before proposers enter. Its benchmark position follows the reserve weights fixed at announcement. It owes no asset delivery because the reserve already holds those assets.

A larger system stake pulls the target closer to the current reserve. It also increases the SAPIO in the reward pool.

With no proposers, the target stays at the current composition. The protocol creates no purchase instructions.

## Proposers stake on eligible tokens

Each position selects one eligible token. One proposer can open positions on several tokens.

Proposers stake SAPIO. The reward pool contains the SAPIO stakes of the proposers and the system.

Later submissions do not unlock or resize an existing stake. They can change its relative influence and delivery responsibility before submissions close.

Submission has a deadline. The protocol rejects new stake after that deadline.

## Stakes define the target

The target is the reserve composition that the protocol aims to reach. The system stake votes for the current composition. Proposer stakes vote for their selected tokens.

More proposer stake gives those votes more influence within the volume limit. The volume limit caps one competition's target change.

The target does not guarantee complete execution. Actual purchases depend on settlement.

A shortfall on one token cannot increase another token's delivery responsibility. Partial execution can still change all reserve weights because each weight uses the total reserve value.

## One-round movement is bounded

Even a very large stake cannot break the one-round target limit. This limit does not prove safety across repeated competitions.

[Security](https://sapio.network/docs/security.md) explains the conditions and limits of the security claims.

## The protocol buys only what the target needs

The target calculation does not require selling existing reserve assets. The protocol creates purchase instructions for the new assets it needs. An instruction states how much of one token the competition seeks to acquire.

Part of the proposer vote can match the current reserve. The protocol subtracts this overlap when it computes purchase instructions. This can reduce the assets that proposers must deliver.

Delivery responsibility and reward weight are separate. Stake that matches the current basket can remain eligible for rewards without a new delivery.

The protocol sets delivery responsibility when submissions close. Public sellers can reduce the quantity left for proposers.

[Settle](https://sapio.network/docs/settle.md) explains how public sales and later reserve changes affect actual delivery. The [Settlement Reference](https://sapio.network/docs/settlement-reference.md) gives the detailed rules.