Silicon markets

#Markets come in two kinds

Silicon markets list thirteen instruments on Robinhood Chain. Six are synthetics and seven are stock tokens.

A stock token is a Robinhood Stock Token of a chip company. It is the same asset the Reserve buys and holds.

A synthetic tracks a chip commodity that has no equity: GPU rental hours, memory contract prices and packaging capacity. It is minted against collateral and priced by an oracle.

#Synthetics track chip commodities

A holder mints a synthetic by depositing $KYZN and USDG as collateral. The position stays open while its collateral ratio is 150% or more.

Minted synthetics trade in Uniswap v4 pools against USDG. The USDG address is listed in Contract addresses.

A synthetic is not a share of any company. It is not redeemable against the Reserve; redemption applies to $KYZN only.

The Markets view shows Minted synthetics, the dollar value of synthetics minted.

#Stock tokens are Reserve assets

Seven Robinhood Stock Tokens have a live Chainlink feed on Robinhood Chain. Those seven are eligible for the Reserve.

NVDA and AMD are the Reserve's initial holdings, targeted 50/50. The others enter by rotation, under the Scheduler's stage weights and the 50% stage cap. See The Reserve and The Scheduler.

AVGO, AMAT, LRCX and KLAC exist as stock tokens without a Chainlink feed. Each becomes eligible when Chainlink publishes its feed.

No power-stage stock token exists, so the Power weight is held in Design.

#Minimum collateral ratio is 150%

Collateral is a mix of $KYZN and USDG. At least 50% of its value is $KYZN.

The collateral ratio is collateral value divided by the value of the synthetics minted against it. It must be 150% or more.

ratio      = ( K + U ) ÷ D  >= 150%
$KYZN part = K ÷ ( K + U )  >= 50%

Two moves lower the ratio: a fall in the $KYZN price and a rise in the synthetic's oracle price. The $KYZN part of the collateral moves with the $KYZN price.

Opening at the minimum

A position opened at exactly 150% has no buffer. Any fall in the $KYZN price or any rise in the synthetic's price takes it below the line.

Shortfall messages

The app states a shortfall with the ratio, the minimum and the fix, in this form:

Collateral ratio 148%. Minimum is 150%. Add $KYZN or USDG.

Against $1,000.00 of synthetics, 148% is $1,480.00 of collateral. Adding $20.00 brings the ratio to 150%, provided $KYZN stays at 50% of collateral value or more.

#Liquidation is a Dutch auction

A position whose collateral ratio falls below 150% is liquidated by Dutch auction.

In a Dutch auction the price offered starts high and falls over time until a bidder accepts it. The first acceptance settles the auction.

The liquidated position pays a liquidation penalty. The penalty is one of the four fee sources and flows to the Reserve and stakers.

The synthetics test suite includes liquidation scenarios. It must be green before any market opens.

#Prices come from published feeds

GPU-hour synthetics price from public rental spot markets, sampled hourly.

DRAM, HBM4 and CoWoS price from the Kyzen Network attested feed. Each value draws on multiple sources under a published methodology.

The attested feed has a dispute window: a period in which a published value can be challenged. The methodology for these three feeds is published before their markets open.

Stock tokens price from Chainlink. Feed behaviour in market hours, closures and corporate actions is set out in Price feeds.

#Fees flow to Reserve and stakers

All four fees flow to the Reserve and to stakers.

Fees that reach the Reserve add to Reserve value, and so to backing per $KYZN. Fees that reach stakers add to their rewards. See Staking.

#Four conditions open a market

1. 01
   Counsel review

   Counsel reviews the synthetics before any market opens.
2. 02
   Green tests

   The synthetics test suite passes in full, including liquidation scenarios. See Security model.
3. 03
   Published methodology

   The methodology for the DRAM, HBM4 and CoWoS feeds is published.
4. 04
   Fee levels set

   The mint fee, borrow fee, liquidation penalty and swap fee levels are set.

A market opens only when all four conditions hold.

The Markets view lists all thirteen markets, each with a Mint or Trade control. A control stays disabled until its market opens under these rules.

#Parameter sheet