Governance and Resolution

Optimistic Resolution (First Come First Served)

• First top 50% staker to submit a proposal becomes official; proposal enters a challenge window (6 hours default).

• If unchallenged, proposal auto-accepts; proposer receives fixed consensus bonus (default $10 USD equivalent).

• Top 50% stakers may challenge, triggering a vote.

This prioritizes speed and efficiency; many outcomes resolve without requiring votes.

Challenge & Initial Voting (Top 50%)

• Top 50% stakers vote between original and challenger.

• Voting window: 24 hours.

• Quorum: ≥10% of eligible stake.

• Majority: >66.7% of votes cast.

• Failure to reach consensus → escalation.

Escalated Resolution (All Stakers)

• Triggered when thresholds/quorum not met or results contentious.

• All stakers vote with snapshot-based weighting.

• Quorum: 10% of all staked value.

• Majority: >66.7% of votes cast.

• Penalty/reward model applies network-wide.

Market Finalization & Settlement

Once finalized:

Step 1: Outcome Verification

• Record winning outcome on-chain with timestamp and proposal ID; link evidence URI.

Step 2: Position Accounting

• Tally outcome shares and total market pool.

• payoutRatio = totalPool / winningOutcomeShares

Step 3: Commission Calculation & Distribution

• Market-level commission deducted first:

  • Staker commission (1-3%) → distributed to governance vaults (initially XRP; later split proportionally across vaults via 7-day rolling average TVL).

  • Dev fee (1%) → development treasury.

  • Creator quality bonus (0.15%) if unchallenged.

TVL-Proportional Split explained: FeeRouter queries vault TVL and uses a 7-day rolling average (168 hourly readings). Any user/keeper can trigger hourly snapshots.

Calculation:

xrpShare = (avgXRPtvl_7d / totalAvgTVL_7d) × stakerCommission
stablecoinShare = (avgStablecoinTVL_7d / totalAvgTVL_7d) × stakerCommission

Step 4: Penalty & Reward Processing

• Penalties are applied by burning shares equivalent to USD penalty.

• Reward pool (sum of burned USD) is redistributed by minting shares to correct participants:

  • 60% to correct proposers

  • 40% to correct governance voters (pro-rata by stake)

Example penalty calculations and share burns/mints are detailed in the design.

Step 5: Winner Payout Availability

• Winners call claimPayout(marketId) to withdraw payouts.

• Payouts do not expire.

Step 6: State Archival

• Market data stored on-chain for history and analytics.

Settlement example (bootstrap, XRP settlement) is provided in the full spec.