ACoconut - Lockup Contract

A financial instrument that allows Foundations to ensure token price stability and prevents investor sell off.

Use Case Description

The system allows sellers to create new lockup issuance, and allows buyers to engage the existing lockup issuance.

Actors

  • Seller, who is the asset seller of the lockup. Usually the Foundation who wants to stabilize the market price of the token asset;

  • Buyer, who is the asset purchaser of the lockup. Usually the token investor;

  • Timer Oracle, who is an external timer service provider that provides timing information.

Precondition

  • Financial Service Providers have created the lockup instruments using the NUTS protocol;

Process Flow

Main Process Flow

  • Seller creates new issuance of lockup instrument;

  • Seller deposits the bonus token to the lockup issuance;

  • Buyers engages the lockup issuance;

  • Buyers deposits the principal token to the lockup issuance;

  • When the lockup ends, the buyers can retrieve both the principals and the bonus token.

Alternative Process Flow

  • If seller does not deposit the bonus token in time, the issuance becomes unfunded;

  • If buyer does not deposit the principal token in time, the issuance becomes delinquent;

  • If there is no engagement in time, the issuance completes with no engagement.

Issuance States

Below are the possible states of a lockup contract.

  • Initiated: The lockup issuance is created;

  • Engageable: The seller deposits the bonus token;

  • Active: The buyer engages the lockup issuance;

  • Complete Engaged: The lockup period ends;

  • Unfunded: The seller fails to deposit the bonus token in time;

  • Complete not Engaged: No buyer engages in time;

  • Delinquent: The buyer fails to deposit principal token in time.