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# Vaults

## Yield Vaults

OpenPad plans to maintain the sustainability of liquidity through protocol-owned liquidity models. Bonding is selling $OPN tokens at a discount to buyers which forms the treasury and then this treasury can be deployed as liquidity directly on markets. (e.g., decentralized exchanges) ## Insurance Vaults ### Fractional Insurance Funds (FIF) OpenPad offers fractional insurance funds for de-risking token sales and early-stage Web3 project investments. • Insurance capital formation: FIF is a self-sustainable treasury reserve allocated to protect qualifying investors from extreme decentralized finance conditions up to 100% of the initial investment. FIF is formed as a portion of the treasury and a certain rate of fees. • Collateral-free: FIF is a no-deposit insurance model, which doesn't require investors to deposit any collateral upfront. Hence, it's 100% risk-free insurance funds to be allocated to qualified investors. • Scope: FIF covers only extreme conditions such as rug pulls, market loss due to smart contract bugs, and similar project-driven faults. The scope of the insurance fund might be voted with the community in the future. • Qualifications: To qualify for FIF, investors must • (1) invested in the deal • (2) register for the insurance fund in the defined time slots • (3) pass the initial deposit threshold • (4) have a$OPN staked in the defined time slots
Note: The initial deposit threshold and the minimum amount of $OPN stake will be determined per deal basis. • Currencies: BNB, BUSD, or$OPN might be used as a type of refund currency.
• Timeline: When the utilization of FIF is confirmed, then the registration and claiming periods will be timelined and announced.
• Refunding: Qualified investors are guaranteed a partial or full refund based on the number of insurance participants and the fund size. Given the pool of insurance-qualified investors, the to-be-determined portion of the insurance fund will be shared proportionally across investors.
• Insurance level: As FIF is a no-collateral insurance-guaranteed fund, the amount qualified investors will receive will be changing deal-to-deal and there will be no promise of a guaranteed amount or percentage or full refunding.
• The utilization portion: The utilization rate of the full FIF will be determined on a deal-to-deal basis and might be voted with the community.
• Vesting: If insurance tokens will be distributed via $OPN, there will be a vesting period to avoid instant sell-side pressure and the terms will be scheduled when the utilization of FIF is confirmed. Let's suppose that there are 100 insurance-qualified investors with varying initial investment amounts. Let $A_1$ be the initial amount of investment of investor 1 among 100 qualified ones, $\alpha_1$ be the weight of investor 1 (i.e., $\alpha_1 = A_1 / \sum_{i=1}^{100}{A_i}$ ) let $I$ be the total insurance funds. Then, let $I_p$ be the portion of $I$ allocated for a particular refunding event. Then, investor 1 will receive a refund $R_1 = \alpha_1 * I_p$ . Diving deeper, OpenPad can determine to calculate $\alpha_i$ as a weighted average of insurance fool share and$OPN staked amount. Mathematically speaking, let
$s_1$
be the \$OPN staked amount of investor 1, then
$\alpha_i$
might be calculated as
$\alpha_i = ( \sigma * \dfrac{A_i}{\sum_{i=1}^{100}{A_i}} + \beta * \dfrac{s_i}{\sum_{i=1}^{100}{s_i}} ) * I_p$
where
$0< \alpha < 1, 0<\beta <1$
and
$\alpha + \beta = 1$