Withdrawals & Exit Mechanics

Exit mechanics differ by tranche, and there is no lockup on Senior deposits. The protocol maintains three layers of exit liquidity, designed so that lenders can always get out, even in stressed markets.

1. 1.Instant Withdrawal (0 to 3% Haircut). The protocol maintains a reserve in T-bills and stablecoins (targeting 15% of pool value). Senior lenders can withdraw instantly from this reserve at any time. A dynamic haircut of 0% to 3% applies depending on reserve health: when the reserve is full, the haircut is zero. As it depletes, the haircut rises to a maximum of 3%, creating an anti-run incentive. Haircut proceeds flow back to the pool.
2. 2.FIFO Queue at NAV (No Haircut). If you prefer to avoid the haircut, you can join a first-in-first-out redemption queue instead. You exit at full NAV, with no haircut, and are paid as liquidity becomes available (from premium settlements and borrower repayments). The app shows your position in the queue and an estimated time to fill.
3. 3.Claim Resale. If you are in the queue and need to exit faster, you can list your claim for sale. Claims are fixed-dollar IOUs (priced at NAV at the time of request), so the buyer inherits your queue position without NAV exposure. Asks are set by the seller and float freely. This brings in outside capital and is designed as the third layer for stressed scenarios when the reserve is depleted.

Junior Tranche Withdrawals

Junior requires a minimum 45-day notice period before withdrawal. After notice is given, shares are burned and queued. Queued capital stops earning yield and stops bearing losses. Junior claims are paid in FIFO order as liquidity allows, and are also eligible for claim resale. This notice period exists because Junior is the structural first-loss buffer: if Junior could exit instantly before a crash, it would defeat the purpose of the tranche.