Fund Documents · 01 of 08

The Fund (Mechanism)

How new RPT is issued, who receives it, and the one lever that decides the rate: the market premium over backing.

RPT mirrors the OlympusDAO v1 architecture: Token, rebasing activated token (sRPT), Treasury, BondDepository and Distributor, plus a TaxCollector, GenesisBond, InverseBond, PremiumSeller and a management-option contract. This page covers the dividend engine and the standard offerings. The treasury side, including the restore point, is under Treasury and NAV.

1. The Shareholder Dividend Program (activated shares)¶

Holders activate RPT and receive sRPT, a rebasing token whose balance grows every epoch. An epoch is 8 hours, so there are three distributions a day. Each epoch the Distributor mints new RPT at the formula rate below and the staking contract rebases sRPT so every activated balance grows in proportion. The cumulative growth is tracked by the distribution index, sRPT.index(), which starts at 1.0 at genesis and only ever rises. It is the "growth since genesis" figure in the Shareholder Console.

The rebase call is permissionless once an epoch has elapsed. Anyone can turn the crank; nobody can adjust it.

2. The emissions formula¶

There are no owner functions on the emissions path. Every parameter below is immutable in the Distributor. The rate is a pure function of the premium of market price over NAV (backing per token; treasury-owned RPT is valued at its 1 USDG floor, never at market):

P    = marketPrice / NAV                       (premium multiple)
rate = R_MAX × clamp((P − 1) / (K − 1), 0, 1)

• At or below NAV (P ≤ 1.0): the distribution is zero. The fund does not dilute holders when the market pays no premium.
• At a 1.75× premium or above (P ≥ K): the full 0.45% per epoch.
• In between, the rate is linear in the premium. There is no other input.

3. The price oracle, and Safe Mode¶

marketPrice is a time-weighted average from the canonical Uniswap v2 RPT/USDG pair, computed from cumulative-price observations. Spot price is never used, and the source pair cannot be changed by any key.

• checkpoint() is permissionless and stores the pair's cumulative price, with a minimum of 30 minutes between checkpoints.
• A TWAP read is valid only over a window between 30 minutes and 4 hours. Outside that band, every dependent operation reverts: the Distributor skips the epoch and mints nothing, and the restore point and premium sales refuse to settle.

4. Premium → rate → APY¶

This table is the entire distribution policy. Rates compound per 8-hour epoch; daily is 3 epochs, APY is 1,095.

Sanity bound: at the full rate, supply grows about 1.36% a day, roughly ×1.5 a month compounded. In practice the reserve cap binds long before the formula does whenever the premium collapses.

5. The reserve cap: the floor under everything¶

The Distributor cannot mint past reserves. If a mint would push totalSupply × 1 USDG above the Treasury's risk-free value (RFV), the mint reverts or clamps to the cap. This enforces the fund's core invariant on-chain, every epoch:

Distributions are therefore self-limiting: emissions can never issue a share the treasury cannot stand behind at the floor.

The invariant suite enforces a broader rule, global accretion: no protocol operation may reduce NAV, with exactly two named exceptions, both of the "dilutes the premium, never the floor" kind: the epoch mint (bounded by the premium gate and the RFV cap) and management-option exercise (bounded by its float cap, with every exercise paying the 1 USDG floor into the treasury). Everything else, offerings, buybacks, premium sales, fee conversion, Morpho rebalancing and the founding offering, is weakly accretive without condition.

6. Primary Offerings (bond sales): never below NAV¶

After genesis, the BondDepository sells RPT for USDG or for RPT/USDG v2 LP tokens under a pricing rule with no discretion in it:

price = max(TWAP × (1 − BOND_DISCOUNT_BPS), NAV)

• The floor is NAV, not 1 USDG. The depository never sells RPT for less backing than it already has, so every sale is strictly accretive.
• Capacity is capped per epoch at BOND_EPOCH_CAPACITY_BPS of supply, fixed at deploy. No control variable, no debt-ratio controller.
• LP payments are valued by the same 2·√(x·y) convention as the treasury's own liquidity: the RPT leg at its 1 USDG floor, never at market.
• Together with the restore point's standing bid at NAV − 1.5%, the protocol always quotes around NAV from both sides: it buys below and sells at or above.

7. Rebase accounting¶

sRPT follows the OHM v1 "gons" model literally: total gons are fixed and each rebase scales gonsPerFragment, so every activated balance grows pro rata with no per-holder writes. Total sRPT fragments always equal activated RPT; the RPT ⇄ sRPT peg is conserved by construction. A wrapped, non-rebasing token, wsRPT, is built on the index for anything that needs a fixed balance.

8. No operators required¶

Every operational entrypoint is permissionless: the oracle checkpoint, the rebase, the restore point (which is seller-initiated), the premium seller's execute(), the fee conversion and the treasury's Morpho rebalance. Every precondition is enforced on-chain. If the formula says no, the call reverts regardless of who calls. There is no allowlisted keeper; the protocol has zero liveness dependency on management. Fund-run bots poke these functions on a schedule as a convenience, and anyone can run the same bots.

9. What management cannot do¶

No key, multisig or "policy team" can change the epoch length, R_MAX, K, the TWAP source pair, the total trading fee, the fee-split formula, the offering pricing rule, or the management-option strike, cap or vesting schedule. The only permissioned surface in the whole protocol is the trading-fee pair mapping and whitelist, and it is add-only: no removal functions exist in code. The only way to change the distribution policy is to deploy a different fund. There will be no service pack.