Deposit and Withdrawals
<figure> <img src="https://placeholder.com/piron-deposit-withdrawal-flow" alt="Deposit & Withdrawal Flow"> <figcaption>Investor journey: deposit → vault shares → yield accrual → redemption</figcaption> </figure>
Deposits
Investors participate in Piron pools by depositing USDC or supported regional stablecoins (e.g., cNGN, EURS, KES). Upon deposit:
Stablecoin Transfer → The investor sends stablecoins to the chosen pool vault.
NAV Pricing → The vault computes the current NAV/share based on all holdings and accrued yield.
Share Issuance → The investor mints ERC-20 pool tokens, proportional to their deposit at that NAV/share.
Custody → Shares are held directly in the investor’s whitelisted wallet under full self-custody.
Timing & Access
Managed Pools (Revolving): Open for deposits at any time. New capital is deployed into the next available issuance or used to replenish liquidity buffers.
Managed Pools (Epoch): Accept deposits only during subscription windows (e.g., weekly, monthly). Funds are batched and deployed together.
Single Asset Pools: Open only while a new issuance (e.g., CP note, invoice batch) is being subscribed. Once filled, no new deposits are accepted until maturity.
Tenor Selection
When depositing, investors may choose a tenor (lock duration) that aligns their capital with underlying assets:
90 Days → Short lock, suited for rolling T-bills and frequent access.
180 Days → Medium lock, balancing yield and liquidity.
270–360 Days → Long lock, targeting maximum yield from longer-dated instruments.
Tenors map directly to the portfolio ladder: deposits are allocated into instruments of matching or nearest-fit maturity. This ensures Piron avoids mismatched cash flows while giving users transparent expectations of yield and liquidity.
Withdrawals
Withdrawals are processed by redeeming pool tokens back into stablecoins:
Redemption Request → The investor submits a withdrawal instruction.
Token Burn → Pool tokens are burned from the investor’s wallet.
NAV Settlement → Redemption amount = (shares × current NAV/share).
Payout → Stablecoins are returned to the investor’s wallet.
Timing & Liquidity
Managed Pools (Revolving): Small/medium withdrawals serviced immediately from the liquidity buffer. Larger requests may be queued until the next scheduled maturity.
Managed Pools (Epoch): Withdrawals are processed only at the end of the epoch. Investors receive proceeds once underlying instruments roll off.
Single Asset Pools: Withdrawals are fulfilled at the maturity of the underlying instrument (e.g., when a CP note is repaid).
Early Exits
Minimum Hold: Investors must remain in the pool for at least 30 days before requesting early exit.
Penalty: Exiting before tenor maturity applies a redemption penalty (e.g., 1–3%), deducted from the accrued value.
Liquidity Condition: Early exits are only paid out if buffer liquidity is available; otherwise they are queued until a natural maturity event.
This ensures fairness between long-term investors and early redeemers, while protecting pool stability.
Compounding vs Payout
On maturity or redemption, investors may choose between:
Compounding → Automatically roll principal + yield into a new cycle of the pool, increasing share balance and future earnings.
Payout → Redeem directly to stablecoins, harvesting yield as income.
Compounding helps long-term investors benefit from exponential growth, while payout suits users seeking periodic cash flow.
Liquidity Buffers
To smooth redemptions, each pool maintains a cash buffer:
Sized dynamically (e.g., 5–15% of AUM) based on redemption history.
Replenished first when instruments mature, before reinvestment.
Ensures orderly redemptions without prematurely liquidating assets.
This is the mechanism that makes revolving pools viable, even when underlying instruments have fixed maturities.
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