Developers
Protocol Overview
Sentinels
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Liquidations & TOGA
How does Superfluid keep streams solvent? Who's job is it?
Liquidation and Solvency
When opening a stream, a user must lock a certain amount of tokens as a
buffer or deposit which is taken out of their balance. By leaving their streams open for too long, they stand to lose the buffer. This mechanism creates the main incentive for users to close their Superfluid streams before running out of tokens. It is a user's own responsibility to close their stream.superApps can also draw an owedDeposit, allowing them to open a stream of the same size, without needing an initial balance. Here's the general flow of solvency states for Super Tokens in a Constant Flow Agreement:
1. Solvent
Everyone is in good standing. The sender's balance is greater than 0. The stream flows to the receiver as expected, and there are enough tokens to back the stream.
2. Critical
The sender's balance is now zero, and the permissions on the stream now allow anyone to close it. Until the stream is actually closed, funds are paid to the receiver's wallet using the sender's initial
buffer. When the stream is closed, any remaining
buffer is added to the rewardAddress (the TOGA contract), which adds it to the current Patrician's stake.3. Insolvent
If the stream isn't closed, and the sender's deposit is completely consumed, then the insolvent period begins. The stream will continue to the receiver, however since these tokens don't actually exist in the sender's wallet, we must keep track of this
deficit so that the Super Token itself can remain solvent within the Superfluid Protocol.When the stream is eventually closed, the
deficit is taken from their Stake as a slashing fee. This slashing fee is then burned, to offset the tokens created by the insolvent stream. At the same time, a reward is issued to the account closing the stream, whom we call (depending on who closes it and when) a Patrician or a Pirate.Patricians and Pirates
Each token has an account called a PIC (Patrician in Charge).
Every time a stream is closed while Critical, the remaining amount of the
buffer balance of the closed stream is taken as a reward by a Patrician. Every time a stream is closed while Insolvent, the Patrician is slashed, and the Pirate is rewarded as a result.
Patricians have Priority and do the bulk of the work. Pirates must be always vigilant, and are essential in keeping the Patrician in check. Remember, a Pirate can be rewarded for closing streams that Patricians miss.
TOGA - Transparent OnGoing Auction
PICs have a strong incentive to close streams as soon as possible, since they earn the remaining balance of the sender's deposit. Technically, anyone can close stream during the Critical or Insolvent states, however rewards are added to the Patrician's
stake.To become a PIC for a token, aspiring Patricians must post a
stake to the TOGA contract, in the token they are trying to become a PIC for. If the new stake is higher than the existing stake, the new Patrician becomes the PIC, and the previous Patrician gets their stake back. PICs can't remove their
stake at will through a single transaction, but rather, they have to specify an exitRate, which defines the flowrate of a Stream to their account. The exitRate is also not completely arbitrary, it has be long enough to keep the stake above zero for at least a week.All liquidation rewards are added to the
stake. The TOGA contract leverages the ERC777 callbacks, so you can become the PIC by simply sending a regular transfer to the right contract address! In this case, the
exitRate will be set at the default rate.Current Parameters
Polygon
xDAI
Testnets
Deposit
4 hour
deposit4 hour maximum
owedDepositTOGA
1 week minimum
exitPeriod4 week default
exitPeriodDeposit
4 hour
deposit4 hour maximum
owedDepositTOGA
1 week minimum
exitPeriod4 week default
exitPeriodDeposit
1 hour
deposit1 hour maximum
owedDepositTOGA
1 week minimum
exitPeriod4 week default
exitPeriodThese parameters can be changed by Governance decision. Previously established
deposit for Constant Flow Agreements is grandFathered, so future changes can't impact existing agreements. The TOGA contract is set as the
rewardAddress in the Superfluid host. The rewardAddress may be changed to a different address. Every SuperToken may have a different rewardAddress, so it's possible that different SuperTokens have different implementations.
Last modified 21d ago