The liquidity pool
The pool is the other side of every Stratos trade. It sells convexity to longs, buys it from shorts, collects funding and trading fees, and hedges what it holds on Derive. Anyone can deposit into it.
What you get
A deposit mints shares at the current share price (pool value ÷ shares). The share price moves with the pool's P&L: up as funding and fees come in, down when traders win more than the hedge recovers. Your value is shares × share price.
What it earns
- Funding from longs (minus what it pays shorts), net of the cost of its own hedge.
- Trading fees: 0.05% each way on standard trades, 0.02% on knock-outs plus 5% of their profit.
- Half of each liquidation fee (1% of the notional liquidated) goes to the insurance fund that protects the pool; the knock-out buffer (20% of a knocked-out position's collateral) goes there too.
What it risks
The pool loses when traders win big and the hedge doesn't fully cover it: tracking error between the exact payoff users get and the options strip plus perp the pool holds. The protections are described under Safety: a gap stress cap on every open, an insurance fund targeted at 2% of open interest, and a capped haircut on winners as the last resort. The pool can lose money; it is not a savings account.
Withdrawals
Withdrawals are queued and paid at the weekly roll, Fridays 08:00 UTC, at that moment's share price. The roll is when the pool's weekly options strip rolls over and straddles re-centre, so it's the one time the pool's value is fully marked against settled hedges.
Capital tiers
The pool's size sets how much leverage traders may take (5x / 50x below $250k, 10x / 75x to $1M, 20x / 100x after) and the open-interest caps per coin, which rise with the pool and step up by stage as the system earns it.