How it works
One pool, two sides, five steps
A depositor names the price they would happily be bought out at. A purchaser pays the pool price and finds out what they get. Everything below is fixed in the contracts, not set by an operator.
- 01
A depositor locks a position
Pick a whitelisted ERC-721 and a USDG backing stake. The NFT moves into protocol custody and the backing is held alongside it. Backing is fixed for the life of the position — there is no adjusting it later.
Fixing it is what makes the standing bid meaningful: a depositor who could raise their bid after seeing demand would be quoting a price nobody can rely on. The escape hatch is withdrawal, which is free and always available.
- 02
Backing sets weight and price at once
The same number does two jobs. It sets the position's selection weight at 1e36 ÷ backing, and it funds the irrevocable bid the depositor commits to reacquire the NFT for.
Weight is inversely proportional, so a 5 USDG position is drawn sixteen times as often as an 80 USDG one. Light positions turn over constantly for a small return; heavy positions sit, collect fees, and cost more when finally taken.
- 03
A purchaser pays the pool price
One price for the whole pool: the harmonic mean of every active backing, plus a 3% surcharge. The purchaser does not choose which position they get.
The harmonic mean stops any single large backing from dragging the price up. That keeps entry cheap while heavy positions stay rare — which is the whole shape of the game.
- 04
The draw is frozen, then resolved
The moment the request lands, payment is escrowed and the selection set is frozen. Randomness comes from a future drand round whose value nobody can influence, verified on-chain.
Nothing about the eligible set can change while randomness is in flight. This is the exact gap that drained the protocol Tuck is modelled on, so it is enforced as a contract invariant rather than a convention.
- 05
The purchaser settles
Being drawn transfers nothing immediately. The position is marked as allocated and the purchaser picks one of four paths within 24 hours.
After 7 days anyone can finalise the default outcome — NFT to the purchaser, backing to the depositor — so a position can never lock up because someone walked away.
A worked example
Numbers below use the locked parameters. They illustrate the mechanic; they are not a forecast.
| Step | Figure | Where it comes from |
|---|---|---|
| Pool composition | 40 positions at 80 USDG | Seed inventory |
| Harmonic mean | 80 USDG | All backings equal, so HM equals the backing |
| Purchaser pays | 82.40 USDG | 80 × 1.03 surcharge |
| Sell-back value | 76.00 USDG | 95% of the drawn position’s backing |
| House edge | ≈ 7.8% | 1 − (0.95 ÷ 1.03) |
Read that last row before you play. Accepting the bid on every draw loses roughly 7.8% each time. The only way to come out ahead is to keep NFTs whose market value exceeds 95% of their backing. That judgement is the entire skill component.
What a depositor is actually risking
Not principal
The backing is returned whichever way the position settles. A depositor is not staking capital against a loss in the way the word “stake” usually implies.
Duration
Selection weight implies an average lifetime, but any position can be drawn early. A position drawn sooner than its weight implied stops earning sooner. That gap is the real exposure.