Open-interest fees

Why the fee exists

Vault owners provide REP-backed security, keep their vaults healthy, and may need to take part in reporting and migration. In return, each fee-eligible underwriting commitment earns a share of the fee in proportion to its size. Owners claim aggregate earnings from the portfolio without visiting each question.

Fees in a shared portfolio

A portfolio holds actual question collateral in a shared settlement contract. Each question has a linear fee stream, and an aggregate expiry index advances all streams without visiting them individually. Fees reduce both funded collateral and its internal accounting units. Outcome token supply remains separate, so a fee changes each remaining token's redemption value.

The creator fixes one annual rate, applied to each question's outstanding principal basis. It does not compound against shrinking collateral. Minting and redemption preserve that basis per remaining share. Fees continue after the question's calendar end until reporting starts or the fee budget above the backing floor runs out. Stale-price intervals and recovery books do not charge ordinary holding fees, and later price recovery never backcharges those intervals.

The creator also fixes minimumOutcomeRate, the minimum settlement units reserved per outcome share, scaled by 10¹⁸. The UI defaults to 0.01, or 1% of the initial rate. Holding fees can consume only the units above that rounded-up reserve. The stream ends before another whole second would cross it; no question scan or keeper action is needed. Purchases and redemptions remain proportional at the floor. For example, 1,000 complete sets retain at least 10 ETH in a fully funded book with a 0.01 floor.

This caps ordinary fee income; it does not release the remaining underwriting obligation or waive purchase fees and the prepaid resolution premium. Providers must account for a possible period without holding-fee income before redemption or finality. The floor protects against fee depletion, not an underfunded fork: recovery claims may pay less ETH plus REP, and tiny claims still face token-unit rounding.

Each purchase also prepays 52 days of fees on its added principal: the maximum ordinary three-day reporting window plus seven-week extension. This resolution premium stays with the question. Once reporting starts, providers earn only the portion corresponding to time the question remains unresolved, up to the prepaid amount. An expiry index stops those earnings at finality without requiring an owner or keeper to visit each question. Unused premium is burned when the question becomes final or all trader complete sets are returned, because the contract does not record which buyer paid it. The premium is nonrefundable; later providers cannot collect an already resolved question’s remaining budget.

Before collateral, price or commitment changes, the capital ledger credits earlier income under the old eligibility weights. An owner's entire deposited principal determines health; separately claimable earnings do not count as backing. Each healthy commitment earns its fraction of total outstanding commitment, including unhealthy commitment in the denominator. A tiny healthy position therefore cannot collect every unhealthy owner's income. Deposits without commitment earn no underwriting income, and retirement positions keep earning while their healthy commitment remains outstanding.

Every purchase pays the same configurable backing-based fee, including when capacity is reused. The whole backing fee vests over the configured reward duration, as does recognized REP income. These vesting rewards compensate the healthy commitments serving when each portion unlocks, even if the original question has already resolved. A provider who retires gives up future unearned portions.

Income released without eligible backing is not saved for a future provider. Unassigned ETH and REP are burned. No shared budget pays keepers or price sponsors: whoever needs a fresh price pays for it, and the owner of an unhealthy position, or a taker that cures it first, pays for the cure. Owners collect their own aggregate ETH and REP earnings without visiting questions.

There is no separate ETH reporting charge or bonus. Anyone can report by staking REP in the Escalation Game, whose REP payout rules still apply. Shareholders have an incentive to resolve claims, and backing providers have an incentive to release occupied capacity. These incentives do not guarantee prompt reporting: participants can wait for someone else to pay gas, and a small or abandoned question may remain unresolved.

A fork preserves the dates of existing purchase-fee and REP-income streams. If the parent price was fresh at the fork, eligible frozen commitments continue earning them. Parent income that cannot be assigned is burned; principal and earned claims are excluded. Question premiums follow the chosen commitment’s branch allocation. A question’s remaining funded premium can support its child reporting period; repeated forks do not create additional funding. Premium elapsed while the child is inactive is burned, so delaying activation cannot create retroactive provider income. The portfolio reference specifies these custody boundaries.