The Auto Redemption Barrier is a risk automation threshold that determines when GRVT will automatically process redemption requests of shares from customers, without needing explicit vault manager intervention.
It serves two core functions:
Automation of Redemption Servicing
It enables GRVT’s platform to redeem LP Tokens on behalf of users when the vault is financially healthy enough (above a configured safety margin). This reduces operational load on vault managers.
Protection Against Negligence if Redemption Requests
Prevents situations where vault managers delay redemptions unnecessarily even when the vault can afford to fulfill them
Auto Redemption Logic
In particular, if Total Equity (TE) > auto_redemption_barrier × Initial Margin (IM), then, GRVT’s system will automatically service redemption requests, based on priority queue logic.
Design Properties
Field | Description |
Range | 0.8 - 2.0 (i.e. 80% – 200% of IM specified in centibeeps) |
Who Sets It? | Vault Manager (during vault creation or update) |
System Response | Redemption request is automatically processed by GRVT when auto redemption logic is met. |
Priority Queue Used for redemptions | To service redemptions, GRVT’s system follows a hybrid FIFO/Min-Heap priority queue logic. In other words, redemptions are serviced as a function of number shares being redeemed for USDT and when the redemption request was made. |
Mutable | Yes. Can be increased or decreased by the vault manager |
Example
Initial Margin (IM) = $100,000
Auto Redemption Barrier = 120% → $120,000
If the vault’s Total Equity (TE) is $150,000, then redemptions can be auto-serviced by the GRVT system without manual intervention.