peardThree levels of promise
Quoted, settled, fulfilled. Conflating them is how a product like this goes wrong.
What a holder is owed comes in three levels, and each one is backed by something different. Conflating them is how a product like this goes wrong.
| Level | What the holder gets | Backed by |
|---|---|---|
| Quoted | Chart, market cap, and every number in the UI are in bottles. A deterministic view over the on-chain TWAP. | Nothing, because nothing is promised. Works for literally anything with a number. |
| Settled | Fee accrual is denominated in bottles when it accrues, and pays USDC worth that many bottles at claim. | The reward vault, and only ever the reward vault. |
| Fulfilled | Burn rewards worth one bottle, a bottle arrives. | A hard per-epoch USDC budget out of the vault. A valve, never an obligation. |
Quoted costs nothing and promises nothing
This is why the registry can hold the Phoenix daily high alongside the S&P. A quote is a view over two numbers that already exist, and there is nothing to back because nothing is promised.
The chart is in units of the pairable, not dollars, because that ratio is the entire reason this exists. "Up 40% against Coke" is a claim with an opponent; "up 40%" in a bull market is not.
Settled is where the exposure lives
Exposure requires a counterparty. No mechanism evades that, and it is worth being blunt about who the counterparty is here.
At INDEX grade it is the reward vault's accumulated drift, which means holders trade unit-price exposure against each other across time. A holder who claims while the unit is cheap takes fewer dollars than accrued and leaves the difference behind; that surplus is what funds the holder who claims while the unit is dear.
One number describes the whole thing:
S = holder_usdc / owed_usdc where holder_usdc = available_usdc - protocol_fees_usdc
Note what the numerator excludes. It is not the whole available balance. The protocol's uncollected cut is subtracted first, because that money is not the holders' and never was. Counting it would make coverage read high and then step down the instant governance sweeps, which hands a first-mover advantage to whoever happens to claim just before the sweep.
S >= 1 pays face value. S < 1 pays owed * S, pro rata, no exceptions, and
the shortfall burns the full units, which lifts S back up for everyone still
holding. S is published on every market and the UI must never hide it.
The important consequence: the vault is the only thing at risk. Not the pool, not the supply, not anyone's principal. The worst case is a reward claim that pays less than the sticker.
tests/peard.ts walks exactly this. One holder claims into a $1.99 print
after accruing at $2.49 and loses on Coke, the shortfall banks as buffer, and a
second holder claims into $2.99 and takes the full sticker out of it.
At Native grade coverage is 1.00 by construction rather than by arithmetic, because the vault holds the very thing it owes. See Quote modes and coverage.
Fulfilled is a valve, never an obligation
request_fulfillment burns units from the holder's ledger, quotes them in USDC
at the print, and reserves rather than moves the money. An off-chain agent
ships the thing and calls settle_fulfillment.
Two ceilings, max_request_usd and epoch_budget_usd, mean a run on the valve
degrades into a queue rather than a drain. It can only ever spend from the
reward vault's own dollars, and only up to the epoch budget.
Nine pairables are fulfilment-enabled today, and all nine are things an agent
could actually buy on demand: COKE-20OZ, EGGS-DOZ, MILK-GAL, BIGMAC-US,
BIGMAC-CH, GAS-GAL, RAMEN-PK, RICE-20LB, PEAR-EA.
The off-chain agent does not exist. The chain side is built and tested; nothing ships anything today.
Which level a market can offer
The level is not a per-market setting. It falls out of the pairable's grade and the market's quote mode.
Quoted. There is no gate on this at all, and 12,210 ordered pairs are quoted right now without a single market account existing.
Settled. The reward vault backs it, and coverage tells you how well.
Fulfilled, and only where the pairable's FulfillmentConfig is enabled.
Native markets are refused with FulfillmentNeedsDenominated: the valve
spends dollars to buy an object, and a Native vault holds equity.
A redemption right. Nothing here promises that a holder can hand back a token for the underlying. The valve is a budget, and a budget that is exhausted refuses rather than queues into insolvency.