Live Funding Capacity

🧱 Drawdown Allocation Exposure (DAE) explained

To keep payouts fair and sustainable, we limit how many traders can go live based on the DAE. This helps protect the Community Payout Pool and ensures top-performing traders get funded.

📐 How It Works

We calculate the Drawdown Allocation Exposure (DAE) using this formula:

DAE = (Total Net Pool Inflow × 2.0) − Total Funded Trader Exposure

  • Total Net Pool inflow = (50% of Total Evaluation Fees) − (Refunds + Withdrawals + Hedge Costs + Airdrops)

  • The Allocation Multiplier determines how much total drawdown the pool can absorb across all live accounts.

  • Total Live Trader Exposure = Combined static max drawdowns of all active live sim accounts

Allocation Policy Explained

Example: If the protocol has generated $200,000 in evaluation fees to date:

  • 50% of that goes to the pool = $100,000

  • After deducting $20,000 in refunds, withdrawals, hedge costs, and airdrops → Net Pool Inflow = $80,000

  • Total Live Trader Exposure = $40,000

  • With a 2.0× multiplier

The Live Funding Capacity (DAE)= ($80,000x2) - $40,000 = $120,000

This means a maximum of $120,000 in combined static drawdown from active funded accounts can be live at any time.

⏳ First-Come, First-Serve

We do not pre-assign funding slots. Instead, the available DAE is allocated dynamically to passing traders on a first-come, first-serve basis. Once the threshold is reached, additional passing traders are either:

  • Offered a 120% refund payout (20% ROI on their challenge fee)

  • Deferred until exposure becomes available again through pool growth or live sim account liquidations

This ensures fairness and gives all traders equal opportunity to claim their live account when capacity allows.

🔄 Why This Matters

This system protects the integrity of the pool by:

  • Preventing overexposure from large funded accounts

  • Encouraging early performance and timely passes

  • Preserving long-term sustainability for all participants

📊 How Can I Track These Stats?

In your Pool Dashboard or in the #Stats Discord channel server

🔧 Future Adjustments

As the protocol grows and our risk engine evolves, we may adjust the Allocation Multiplier between 2.0x and 2.5x based on:

  • Pool size and liquidity

  • Trader performance data

  • Hedge engine profitability

  • Community governance decisions (post-beta)

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