From 62c804146b2a3375c31be2ef8e23035cecdcab58 Mon Sep 17 00:00:00 2001 From: Matt Luongo Date: Mon, 23 Sep 2019 14:37:15 -0400 Subject: [PATCH] Introduce deposit terms and the rebate NFT Refs #293. --- docs/deposits/economics.adoc | 51 ++++++++++++++++++------------------ 1 file changed, 25 insertions(+), 26 deletions(-) diff --git a/docs/deposits/economics.adoc b/docs/deposits/economics.adoc index 0e817720f..65837a3e0 100644 --- a/docs/deposits/economics.adoc +++ b/docs/deposits/economics.adoc @@ -1,26 +1,25 @@ -= Deposit Economics - -:signer-fee-withheld: 0.005 TBTC - -Once a deposit has been made and funded, the corresponding TBTC is minted. -Minted TBTC is immediately issued to the funder, who is now the beneficiary of -a funded _Deposit_. To prevent denial of service attacks {signer-fee-withheld} -is withheld on minting. This will be returned to the beneficiary when the -_Deposit_ is closed. This ensures that DoS attacks based on repeatedly creating -signing groups (e.g. Attacker creates signing group, locks 1 BTC, creates 1 -TBTC via a Deposit, trades for 1 BTC in an exchange and repeats the Deposit -process multiple times) have high economic cost. - -Beneficary status is transferable (in Ethereum this is implemented as an -ERC721-compatible non-fungible token). When the _Deposit_ resolves, the -withheld TBTC (or equivalent value) will be returned to the current beneficiary -along with a small additional payment. In this way the beneficiary NFT -functions as a zero-coupon bond issued by the signing group upon funding. If -the signing group performs its obligations, the beneficiary will eventually -receive the bond payout. It can be expected that there will be service providers -willing to trade {signer-fee-witheld} TBTC for 1 TBTC-coupon-bond along with -some fee, for providing liquidity to holders of the otherwise illiquid for the -duration of a Deposit coupon. - -Signer fees are described in more detail in -<<../signer-fees/index#,their own section>>. += Deposit economics + +Signers aren't altruists -- they're paid for the service they provide. + +Signer fees should always be paid or escrowed up front. To achieve this, signer +fees must be <<{root-prefix}/minting/index#,guaranteed by minting>>, and +deposits must have predictable lifetimes. + +A detailed treatment of signer fees can be found in +<<{root-prefix}/signer-fees/index#,their own section>>. + + +== Terms + +:term-length: 6 months + +Fixed-term deposits mean signer fees can always be easily calculated per +deposit. A standard term of {term-length} means depositors can budget for fees, +and signers will know how long their bondis will be inaccessible. + +Depositors that don't need future access to their deposit might prefer to pass +the costs of the system to eventual redeemers. These depositors can opt to +receive a non-fungible deposit beneficiary token which pays a fee rebate at the +deposit's redemption. The rebate mechanism is <<{root-prefix}/minting/index#, +explained further in the discussion around minting>>.