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Settlement unwinds a strategy back into the vault, takes fees and fixes the price that queued redeems receive. It can also refuse to run when the vault has lost more than the proposal said it might. This page explains why.

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The drawdown floor is on the vault’s share price

Every proposal declares maxDrawdownBps (--max-drawdown-bps, default 2000). Settle reverts SettlePriceBelowFloor when:
It is measured on the whole vault’s price per share between execute and settle. It is not a percentage of --amount.

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Why it exists

A settle freezes the price that queued redeems receive. Anyone can settle once the duration ends. Without a floor, a settle run during a flash crash, or after a drain, could stamp a near-zero price, and an attacker could then buy shares cheaply against it. The 9,000 bps hard cap does not close that attack completely; it prices it.

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Declare it honestly

Idle assets in the vault count in the share price, so the same bps tolerates a bigger loss on the strategy itself. Example: a 90 USDG vault deploys 60 USDG with --max-drawdown-bps 1500. The floor is 15% of 90 = 13.5 USDG. On the 60 USDG basket that is a 22.5% loss before settle refuses. Voters and guardians read the declared drawdown as a promise. Size it from your kill criteria on the whole vault, not on the basket.

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Exits when the floor blocks settle

When the share price is below the floor, a normal settle cannot run. In order of preference:
  1. unstick (owner). Replays the voted settle calls with the drawdown tolerance fixed at the 9,000 bps maximum (MAX_STAMP_DRAWDOWN_BPS), so it runs unless the share price fell more than 90%. It needs no new calldata and no bond.
  2. Emergency settle (owner). emergencySettleWithCalls commits new calldata and opens a guardian review; finalizeEmergencySettle runs it after the review if guardians did not block. A guardian block burns the whole owner stake (the burn lands when resolveEmergencyReview runs; a blocked finalizeEmergencySettle reverts).

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Who settles, and when

  • The proposer can settle from 1 hour after execute. Before that, settle reverts StrategyDurationNotElapsed. The hour stops an execute-then-settle skim in one block.
  • Anyone can settle after the full strategy duration.
  • Nothing settles automatically. If nobody calls settle, the strategy keeps running and the management fee keeps accruing.
  • A settle batch must have zero net outflow and must leave the strategy with executed() == false, else StrategyNotSettled.

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Fees

Splits are snapshotted at propose:
  • Management: agent 60%, protocol 20%, guardians 20%.
  • Performance: agent 50%, protocol 15%, guardians 25%, fund owner 10%.

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Queued redeems

Redeems queued during a proposal are stamped at settle, after fees, at the realized price. A redeem queued under a proposal that ends Cancelled, Rejected or Expired is never stamped. Its holder must cancel it to get the shares back.