Concepts
The trigger
A pool pays when d stays at or below −X for T minutes of regular-session time.
The rule
A pool triggers when failing observations cover T of session time without a break longer than G.
| Parameter | Production pools | Meaning |
|---|---|---|
| X | 2% | the trigger level is d = −2% |
| T | 30 minutes | how long the streak must last |
| G | 5 minutes | the longest allowed gap between failing observations |
| Payout cap | 20% of notional | the most a pool pays per unit of cover |
How a streak moves
| Observation | Effect |
|---|---|
| fail, within G of the previous fail | extends the streak |
| fail, with no live streak or after a gap longer than G | starts a new streak |
| pass | resets the streak |
| inconclusive | nothing |
| wrong session, stale, not newer than the last one, outside the window | refused |
The streak triggers when the time from its first to its last failing observation reaches T.
- Fail: the whole box is at or below −X
- Inconclusive: the box straddles −X
- Pass: the whole box is above −X
- Failing streak
What the pool page shows
The streak meter on each pool page fills from 0 to T with the failing time proven on chain so far. While a streak is open it shows how much time is left to trigger and how long until the streak lapses if no new failing observation arrives. After a trigger it shows the payout.
Sales pause during a streak
Cover bought during a failing streak would be bought after the loss had begun. While a streak is open, the pool refuses new cover. Sales also stop T before the week ends, since no streak could complete after that.
When the trigger fires
The payout is fixed at that moment; see Payout. Buyers can claim at once, and underwriters can withdraw what is left.