Settlement

Automatic Settlement

By default, all contracts are auto-exercised at maturity if and only if the contract has exercisable intrinsic value. Contracts cannot be exercised early.

All contracts are ‘cash settled’ in the sense that no party has to provide any additional funds during settlement.

All settlement payouts to holders of contracts are made from locked-up collateral amounts.

Settlement Currency

Due to the collateral optimization mechanism, the currency of the locked-up collateral amount can be either the underlying asset or USDC. Thus the payouts during the settlement process could happen in either asset.

However, users will be able to specify their preference settlement currency and will be able to enter into spot transactions to exchange the settlement currency into their preferred currency should they be different.

An optimal asset auction will be set up right after each expiry auction.

Ithaca Reference Price

Next auction forward settled on first focal auction on expiry Friday + average of uniswap pool settled 10 mins around that same auction.

If the next auction forward is more than 0.01% different from the Uniswap volume-weighted average price (VWAP), reference fixing is Uniswap.