Revenue

Sources

• Loans: Users can take out loans for the full value of their tokens. Upon opening a loan and anytime after when additional collateral is posted there is a 1% fee which burns 1% of the collateral. Additionally users can extend the life of their loan rather than having to close it out and open a new one. Each time a loan is extended there is an associated cost of .025 ether or the equivilant of approx. 90$ at the time of writing. The size of the loan is irrelevant to this fee as it is a flat fee. For an entire year regardless of size of the loan users would pay a total of approximately 1.3 ether or approximately, as of the time of writing, 4,635$ in interest. Again this fee is flat and does not matter the size of the loan.

Termination

It is important to note that the ability to terminate expired loans will be callable by any user and it is thus the responsibility of the borrower to make sure that their loans are paid back on time or face risk of losing all the collateral. As stated above users can prevent termination by extending their loan or closing the loan out.

• Arbitrage: The Soteria system has several arbitrage opportunities that anyone can take advantage of. At any given time there can be a difference in price between the market price, mint price, or redemption price. These arbitrage opportunities are in place in order to generate additional volume helping increase other revenue sources for the protocol or have fees attached (redemption) which help generate a sustained increase in the treasury multiplier.

After the initial phase anyone will be able to participate in keeping the market price close to backing. Users who do choose to participate in this activity will be rewarded by receiving 10% of the total profit from the arbitrage. This will help incentivize users to consistently maintain a healthy 'peg' to backing, which allows for greater leverage, drive more volume, and help continiously grow the system.

This is only on for when $RIA is being market sold, not market bought. As there is already a way for users to capture arbitrage profits through redeemptions. The treasury can still be used to arbitrage through $RIA buys using the treasury, but all profits are kept in the treasury itself.

• Liquidity Provision: The protocol will provide the initial liquidity. Fees generated from this liquidity provision will come in two different forms. Weth and RIA. The Weth generated will be added to the treasury in order to provide additional liquidity for loans, growing the protocol, while the RIA earned will be burnt. Both of these actions will help increase the treasury multipler.

The team does have initial plans to create a generalized factory that will allow and token old or new to easily integrated a system similar to Soteria into its protocol, with the same decentralized principles. Work is currently ongoing for this, and for these services the protocol would collect a small small amount from the lp fees generated.