For Backers

Backers provide reserve capital at one fixed rate of one maturity and receive VRT shares in that rate's book. They take the capped variable side of the spread against the fixed rate signed in each quote.

How It Works

1. Run the backer daemon/executor or connect an SDK client to /ws/rfq.
2. Authenticate the WebSocket session by signing the server challenge.
3. When an RFQ matches policy, sign a QuoteMarket.Quote for a pool, series, exact notional, VRT reserve amount, nonce, and deadline.
4. Keep at least vrtAmount of the pool loan token in the maker wallet and approve QuoteMarket to spend it.
5. When the borrower accepts, QuoteMarket pulls that reserve, deposits it into the series on the maker's behalf, and InterestRatePool credits VRT shares.

Quotes are one-shot: a successful fill marks the quote hash used. A maker can cancel one quote on-chain with cancelQuote, or invalidate all quotes at the current nonce with raiseNonce.

Try It Out

Use the simulator to explore backer economics under different rate scenarios.

Backer Simulator

See how leverage amplifies backer returns and how reinvestment compounds growth.

Backing Capital

Fixed Rate (APR)

%

Variable Rate (APR)

%

More Options

Cap Rate (Max Variable)

%

Position Duration

wk

Leverage

217x

$500.00 backs $108.3K notional

$500.00 / ((10.0% - 4.00%) × 4/52) = $108.3K

Position P&L

+$132.47

+26.49% ROI (344.43% APR)

Max Loss (at cap)

$-500.00

If variable stays at 10.0% the entire time

Variable rateFixed rateCap rate

Continuous Reinvestment

Reinvest profits

After each 4-week position expires, roll profits back in as new backing capital. More capital = more notional backed = more yield next cycle.

Reinvestment Period

52 wk

Wk 0

$500.00+$83.33

Wk 4

$583.33+$97.22

Wk 8

$680.56+$113.43

Wk 12

$793.98+$132.33

Wk 16

$926.31+$154.39

Wk 20

$1.1K+$180.12

Wk 24

$1.3K+$210.14

Wk 28

$1.5K+$245.16

Wk 32

$1.7K+$286.02

Wk 36

$2.0K+$333.69

Wk 40

$2.3K+$389.30

Wk 44

$2.7K+$454.19

Wk 48

$3.2K+$529.88

Starting Capital

$500.00

Final Capital (52 wk)

$3.7K

Total Return

+641.84%

Strategy

Setting Your Rate

The fixed rate and reserve amount are the key pricing levers. The reserve must pass the pool's capacity check for the quoted notional. The production executor can create eligible series and submit policy-driven responses to live RFQs.

Diversification

Backing positions across maturities and lending markets can reduce concentration, but it does not remove smart-contract, liquidity, or rate risk.

Continuous Re-investment

VRT withdrawals are limited to freeAssets: the book's value above the reserve still required for its active notional. As maturity approaches, the reserve requirement falls and makes more assets withdrawable. Deposits and withdrawals first sweep any liquidations that are due, so shares are never priced before a pending sweep's gain or loss is booked.

Risk Management

• Variable below fixed — positive spread moves borrower prepaid to VRT assets.
• Variable above fixed — negative spread moves VRT assets into borrower prepaid, up to the pool cap.
• Break even — the cumulative capped variable factor matches the fixed factor before fees.
• Borrower liquidation — when a borrower cell is swept late, the shortfall at the column rate is charged across the expiry's active backers, offset by the forfeited bonds. It lowers earnings; the reserve and the cap keep it from becoming bad debt.

VRT remains exposed to quote pricing, reserve utilization, smart-contract risk, adapter risk, and the underlying lending market.