Provide liquidity
Put a stock token and fyUSD into the vault of its branch, lock it, and be paid in staked FBR. What the vault does with them, what it costs you when the stock moves, and what the programme actually buys.
Spec v0.9.1, reviewed 2026-09-08
Each branch has a vault that holds one Uniswap v4 position in a stock/fyUSD pool, and only the twenty vaults may add liquidity to those pools. Depositing puts your stock and your fyUSD into that position, gives you a share token, and starts a lock you choose.
The reason the vaults exist is narrow and worth stating first: before them there was no stock/fyUSD venue at all, so a liquidator who seized collateral had no direct way back into fyUSD. The vaults create that way back, and they create a wall of fyUSD sitting under the price that a falling market can sell into.
What you deposit
Both legs. You do not have to match the vault's ratio: it pairs what it can and hands the excess straight back, so a deposit in the wrong proportion costs you a round trip and nothing else. A tier 1 vault sits at about 70% fyUSD by construction, because its range reaches much further down than up.
A deposit is refused while the vault's own pool sits more than 1% from the composite price, reverting PoolOffPrice. The pool is briefly off price, somebody is about to arbitrage it, and entering at that moment would mean being bought out a minute later. Waiting a few minutes is the whole remedy.
An interface will offer to supply one leg and swap the rest for you. That swap happens outside the protocol, through the vault's own pool or through the peg module, with a slippage bound you set. The vault itself never swaps anything.
Your shares are computed as a pro-rata claim on what the vault holds, in kind. No price enters that computation, so there is nothing about the moment you deposit that anyone can manipulate against you.
Rules R-1.9.1, R-19.15.2
What the vault does with it
One two-sided position centred on the branch's reference price, plus at most one single-asset position beside it.
| Tier | Buys down to | Sells up to | fyUSD at the centre | fyUSD still there at −20% |
|---|---|---|---|---|
| 1 | 40% | 25% | 68% | 53% of it |
| 2 | 55% | 35% | 70% | 68% |
| 3 | 65% | 45% | 71% | 74% |
As the stock falls, the position buys it with your fyUSD. As it rises, it sells your stock. Nobody presses a button; that is what a concentrated Uniswap position does.
When the price has moved 15% from the centre, 24 hours have passed, and the vault's pool is within 1% of the composite, anyone may recentre: the vault withdraws both positions, sets the new centre at the current reference price, redeposits as much matched liquidity as it can, and puts whatever is left over — stock or fyUSD, never both — into the single-asset position beside it. It never swaps. After a rise, that leftover position is a wall of fyUSD sitting under the price, which is what a liquidation needs.
These ranges were measured before they were frozen: five years of prices across twenty names, replayed against the vault's own rules. Over that history a vault was never left without liquidity at the current price, and at the worst episode it still held a quarter of its fyUSD. What the width cost is depth at the centre, 19 to 30% less than the narrower ranges it replaced. They cannot be changed afterwards.
Rules R-19.15.1, D147, and the five-year simulation
The lock, and what it buys
Four steps. The shortest still carries a minimum of 7 days.
| Lock | Counter multiplier |
|---|---|
| 7 days | 1× |
| 90 days | 1.5× |
| 180 days | 2× |
| 365 days | 3.0× |
Locked shares cannot be withdrawn or transferred before their date. There is no early exit, no penalty and no buy-back: the lock is the commitment the programme is paying for. At most 8 lots are kept per holder, beyond which deposits merge into the lot of the same step.
Two things lift a lock without your asking. If the branch shuts down or the protocol enters its terminal mode, anyone may call unlockAll() and every lock falls at once. And if the stock token stops transferring, the locks fall after 7 days of that.
Only lots locked for ninety days or more receive a share of the fees.
Rule R-19.15.3
What you are paid
Season counters, converted into staked FBR. Your counters accrue as value in range × time × your lock multiplier, checked hourly, and they count only while the current price is inside the vault's two-sided range at both ends of the hour. The season's budget for this class is 30% of the whole, split between active branches in proportion to their debt ceilings, then between depositors in proportion to their counters.
It is delivered staked and only staked. From there it leaves through the exit grid: free after 7 days, or immediately at a cost of 70%. In practice the reward is liquid a week after you claim it.
A quarter of the pool fees, in fyUSD. The pool charges 0.5% on every swap. Of that, 50% fills the protocol's reserve and then buys FBR, 25% is paid to locked lots in proportion to shares times multiplier, and 25% is routed like interest. While no lot of ninety days or more is alive on a vault, that middle quarter goes to the splitter with the rest, so the effective division is 50 / 0 / 50 and nothing is held back waiting for somebody to qualify. You claim your share in fyUSD at any time. The stock side of those fees is sold in lots of at least $250, so a vault does not spend gas selling dust.
Rules R-19.15.4, R-19.15.5, R-19.15.6
What it costs you when the stock moves
This is the part to read twice. A concentrated position loses far more to price movement than a full-width one, and past the lower bound it is entirely stock.
Tier 1, a range of 40% to 25%, starting at the centre:
| The stock falls | Your position is worth | Against holding both legs |
|---|---|---|
| −10% | −4.0% | −0.8% |
| −20% | −9.7% | −3.6% |
| −30% | −17.6% | −8.9% |
| −40%, the bound | −28.1% | −17.6% |
| −50% | −40.1% | −28.7% |
| −80% | −76.0% | −67.8% |
On tier 2 the range is wider, so at −25% the position is worth −11.3%, about −4.1% against holding both, and at −50% it is −33.2% and −21.5%. On tier 3, −50% is −29.5% and −17.4%. A full-width position would have lost roughly a tenth as much inside the range. Below the lower bound you hold nothing but the stock, bought all the way down.
Risk
A vault provider is, in economic terms, a Stability Pool depositor without the discount. The pool buys collateral at 2% to 4% below the market; the vault buys it at the market, minus a fee it does not receive. What the vault gives instead is visible depth and a route back into fyUSD, which the pool does not provide.
Report 13 §5
What the programme actually buys
Honestly: a floor, not the depth of the market. In its first year, the counters for one active branch sustain roughly one to two million dollars of deposits, which on SPY is a floor of seven to fifteen thousand dollars per one per cent of price move — lower than the narrower ranges would have bought, and the price paid for never running out of liquidity. The measured depth of the deepest SPY pool is two orders of magnitude larger. The vault of a branch is therefore useful as a venue and as a buy wall, and it is not the protocol's liquidity.
Only the locked part of a vault counts toward the branch's borrowing ceilings — lots more than a day from unlocking. Deposits that could leave tomorrow buy visible depth and no capacity, and the published depth indicator shows the two separately.
Two further consequences, stated rather than buried.
- The liquidity is incentivised, so it is temporary. When the emission curve decays, deposits fall. The honest expectation is a fall of half to four fifths between the fourth and the eighth season, staggered by the locks. Nothing in the protocol depends on vault deposits: an empty vault breaks nothing.
- The vault releases fyUSD into a falling market. A tier 1 vault at two million dollars pushes about 0.9 million of fyUSD out to sellers during a 20% fall. Some of that goes back to repaying debt, some into pools, and some to the peg module's exit — which can drain the reserve. The ratio of vault deposits to that reserve is published as an indicator, with an alert above one.
Rules R-19.15.9, R-19.15.10
What can go wrong beyond price
Risk
If the issuer freezes the stock token, the vault's position cannot be moved in stock. A withdrawal still returns your fyUSD side, and the stock side stays claimable for whenever it moves again; after 7 days of that, the locks fall so that a long lock is not a trap. What nothing can do is unfreeze the stock: that part stays where the issuer left it.
Rules R-2.4.5, R-15.4.1 (15)
Uniswap's own owner can, at any time, take up to 0.1% of each swap on any pool, ahead of the fee. That would reduce all three fee shares by a fifth. The pools are also closed by a hook to the vaults alone, which means the pool dies with the vault: after a shutdown, nobody can add liquidity to it, though anyone may create an ordinary pool beside it.
The full list is on Vault risk.
Rules R-19.15.7, H27
Repay in USDG
Close your debt with the dollars you actually hold, in one transaction, without buying fyUSD on a market — and what changed about the cap that used to make this unconditional.
FBR and sFBR
A fixed supply distributed for using the protocol, what staking it does and what it costs to stop, and the four ways it divides a flow between users without creating one.