Processing User Redemptions

Standard Redemption (Sufficient Reserves)

When a user submits a redemption request, it is immediately added to the queue. If the Node has sufficient assets in reserve, the rebalancer can fulfill the request directly from reserves and move the assets into escrow for the user to withdraw.

Component Liquidation

If reserves are insufficient, the rebalancer must liquidate components. For example:

• User requests redemption of 100,000 USDC

• Node has 20,000 USDC in reserve

• Rebalancer can partially fulfill the redemption from the reserve

• Rebalancer must liquidate components to source remaining 80,000 USDC

• Components are liquidated in an optimized order (e.g., Aave positions before Ethena)

• Once complete, assets are transferred to escrow for user withdrawal