Redemption

#Redemptions burn $KYZN

Any holder can burn $KYZN and receive a pro-rata share of every Reserve asset at backing minus 2%. The share includes unconverted ETH as well as every stock token the Reserve holds.

Redemption has no cooldown and pays no tax. The 2% stays in the Reserve. The burned $KYZN leaves total supply permanently, because the token contract has no mint function.

Redemptions run from the Redeem view in the app. The view shows the exact assets out, after the 2%, before you confirm.

#Shares use total supply

share = b ÷ S
out[i]  = balance[i] × share × 0.98
kept[i] = balance[i] × share × 0.02

The share is measured against total supply, not circulating supply. Total supply includes $KYZN in the pool, in the team stream and in staking.

A redemption can never take more than b ÷ S of any asset. The Reserve therefore stays solvent for every holder, in any order of redemptions.

#The fee raises backing

Each redemption pays out 98% of its share. The other 2% stays in the Reserve while the burned $KYZN leaves supply. Backing per $KYZN rises for every remaining holder.

backing′ = ( V − 0.98 × V × b ÷ S ) ÷ ( S − b )
         = ( V ÷ S ) × ( S − 0.98 × b ) ÷ ( S − b )

#Redemption pays in kind

Redemption hands over the assets themselves. The Reserve sells nothing to pay a redemption, and it does not pay in a single currency.

The payout is a number of units of each asset, so it does not depend on fresh prices. Redemption does not wait for market hours or for a feed update.

Backing is a dollar valuation at Chainlink prices. The dollar value of the assets received equals 98% of the redeemed share of backing only at those prices.

Stock tokens received are standard ERC-20 tokens in your wallet. The issuer's powers apply to them there, including adminBurn(address,uint256) on any holder. The Reserve is built to tolerate a paused stock token; see The Reserve.

#Unstake before you redeem

Only unstaked $KYZN can be redeemed. Unstaking has no lock, no fee and no tax, so unstaking and redeeming can run in consecutive transactions.

Unstaked $KYZN stops earning the stakers' 1% from that second. ETH rewards earned while staked stay claimable, because rewards never expire.

1. 01
   Unstake

   In the Stake view, unstake the amount to redeem. No fee, no tax, no wait.
2. 02
   Preview

   Open Redeem and enter the amount. The app lists every asset out, after the 2%.
3. 03
   Redeem

   Confirm the burn. No cooldown applies.
4. 04
   Claim

   Claim rewards earned before unstaking from Rewards at any time.

#Redemption binds near backing

A sell through the pool pays the 4% trade tax. A redemption pays 2% and no tax. The better exit depends on how far the market price sits from backing.

pool sell  = b × 0.96 × P
redemption = b × 0.98 × B
redemption pays more when P < B × 0.98 ÷ 0.96 ~ 1.0208 × B

Backing sits below the market price early on. In that range a pool sell pays more, and redemption does not bind.

A buy through the pool also pays 4%. Buying to redeem pays only when the market price is below 0.96 × 0.98 = 94.08% of backing, before price impact and gas. No one is obliged to make that trade.

#Every asset pays pro-rata

#Redemption is not a floor

• Not a price floor. Backing sits below the market price early on, and the market price can fall below backing. See Risk.
• Not a sale. The Reserve sells nothing to pay a redemption.
• Not a dollar payout. The redeemer receives units of each asset, whatever their price.
• Not open to staked $KYZN. Staked $KYZN is unstaked first.
• Not a way around restrictions. The bar on U.S. persons applies to every stock token received.
• Not reversible. Burned $KYZN leaves supply, and the token contract has no mint function.

#Parameter sheet

• ReserveThe ReserveChip equity bought with the tax, grouped by supply-chain stage and priced by Chainlink.
• StakingStaking1% of every trade, funded every 24 hours and streamed to stakers per second.
• ReferenceRiskThe risks of holding, staking and redeeming $KYZN, each with its mechanism.
• ProductsUsing the appWallets, the network, the six views, shortcuts and what the app never does.