Economic Model

Wrapper Backing

Every circulating wrapper is backed by a reserve of the corresponding underlying asset. For this purpose, the protocol maintains separate principal accounting and holds backing for the entire circulating supply of the wrapper token.

Reserve Yield

The reserve backing the wrapper does not sit idle. It is deployed through an approved adapter in a venue with instant liquidity and generates yield. This yield is not distributed to wrapper token holders and does not convert the wrapper into a yield-bearing token. Instead, reserve yield is directed to a separate protocol address as a revenue/backstop stream.

The economic logic is simple: reserve yield is protocol revenue, strategy yield is strategy users' revenue, and the wrapper token is the base transport layer — not a yield-bearing asset.

Strategy Economics

Each strategy has its own economics: a separate share token, its own exchange rate, its own redemption fee, its own cooldown, and its own limits on external allocations. User yield arises only at this level.