🔄Dynamic Redemption

Dynamic Redemption refers to the process where, upon redeeming assets, the quantity and value of the redeemed tokens are dynamically adjusted based on the current market conditions and the changes in the pool's Avg Price. This ensures that the Avg Price in the pool and the interests of other users are not adversely affected.

Users can redeem their inputted assets at any time, but they need to pay attention to the following two factors,

The current issuance ratio between 10x tokens and C tokens.

When deciding to redeem assets using held C or 10x tokens, a proportional amount of C and 10x tokens will be burned according to the current ratio between C and 10x tokens.

In the product, users only need to input the number of C tokens or 10x tokens they wish to burn. The system will automatically update the corresponding required amount of 10x tokens or C tokens.

It will also display the total value of assets that can be redeemed by burning these tokens and the estimated amount to be received.

Redemption quantity based on pool average price vs. spot price.

• If the Avg Price is greater than the Spot Price, the redemption will be settled based on the Avg Price. The formula is as follows,

$$\text{Redemption Quantity} = \frac{C_{\text{redeem}}}{\text{Average Price}} + \left( \frac{C_{\text{redeem}} \times \left( \frac{\text{Total 10x}}{\text{Total C}} \right)}{\text{Total 10x}} \right) \times \text{Profit}$$

It is important to note that although a proportional amount of 10x tokens will be burned during redemption, if the Avg Price is greater than the Spot Price at the time of redemption, it indicates that the pool is currently in a loss state and has not generated any profit. Therefore, burning 10x tokens will not increase the redemption quantity.

• If the Spot Price is greater than or equal to the Avg Price, the redemption will be settled based on the Spot Price. The formula is as follows,

$$\text{Redemption Quantity} = \frac{C_{\text{redeem}}}{\text{Spot Price}} + \left( \frac{C_{\text{redeem}} \times \left( \frac{\text{Total 10x}}{\text{Total C}} \right)}{\text{Total 10x}} \right) \times \text{Profit}$$

If the Spot Price is greater than or equal to the Avg Price, it indicates that the pool is in a profitable state and has generated floating profits. In this scenario, burning 10x tokens during redemption will increase the redemption quantity.