Core Components
Fund Registry
The Fund Registry manages investment funds with Senior/Junior tranches. This is the core component that enables risk segregation and economic alignment.
Core Operations
Fund Creation Parameters
- jurisdiction: "USD", "EUR", "BRL"
- targetSize: e.g., 1,000,000 (in base units)
- seniorRatioBps: 7000 = 70% senior, 30% junior
- seniorYieldBps: 800 = 8% fixed yield
- managementFeeBps: 200 = 2% annual fee
Risk Parameters
| Parameter | Default | Description |
|---|---|---|
| Min Senior Ratio | 10% | Minimum portion for senior tranche |
| Max Senior Ratio | 95% | Maximum portion for senior tranche |
| Min Fill Rate | 50% | Required fill for activation after deadline |
| Max Management Fee | 5% | Maximum annual fee to managers |
Pool Factory
The Pool Factory deploys and manages liquidity pools:
Each pool is uniquely identified by (jurisdiction, riskBucket) tuple, ensuring no overlap.
Weighted Pool
Individual pools handle:
- Deposits: Accept assets, mint LP tokens
- Withdrawals: Burn LP tokens, return pro-rata assets
- Swaps: Execute asset-to-asset trades
- TWAP: Maintain price accumulators for oracle queries
LP Token Mechanics
Token Calculations
lpTokensReceived = (depositValue / poolTotalValue) × totalLpSupplyassetsReceived[i] = (lpTokensBurned / totalLpSupply) × poolBalance[i]Insurance Fund
The Insurance Fund absorbs losses from defaults:
Funding Sources
- Yield waterfall contributions (5% of cashflows)
- Liquidation penalties
- Protocol-owned liquidity
- Direct deposits
Coverage Limits
- Per-asset cap: 10% of fund
- Per-bucket cap: 40% of fund
- Claim cooldown: 24 hours
Yield Router
The Yield Router implements a priority waterfall for cashflow distribution:
Circuit Breaker
Automated safety mechanisms protect the protocol:
Trigger Conditions
| Condition | Action |
|---|---|
| Price deviation > 20% in 1 hour | Pause new deposits |
| Utilization > 95% for 30 min | Pause borrows |
| Default rate > 5% in 24 hours | Emergency halt |
| Insurance fund < 20% target | Elevated monitoring |