Mechanics

Collateral assets for $BLEND must fall within strict liquidity requirements to maintain accurate market pricing. When a user wishes to redeem $BLEND, Vino will trigger redemptions on the underlying assets of the portfolio to return USDC to the user, and rebalances the portfolio between its target weight composition.

There are several key terms:

Mint: The process of a user of the Vino protocol depositing USDC and in turn atomically receiving Vino tokens such as $BLEND or $MERLOT in return.

Burn: The process of a user of the Vino protocol (a KYC’ed entity) sending back $BLEND (burning them) and in turn receiving USDC. Users request a burn when no USDC is available and wait until the next daily rebalance when redemptions occur, or until sufficient USDC arrives.

Subscription: Vino (the entity) investing into RWAs.

Redemption: Vino (the entity) redeeming their RWAs.

The price of $BLEND should never deviate on the secondary market from the NAV per token to the downside more than the cost of capital for the length of time it takes to redeem T-Bills or AAA credit. With the liquidity requirements for $BLEND, this is a non-material amount to a user.

LTF (soon to be TRSRY) which serves as the T-Bill product, currently has t+1 redemptions during banking days, meaning this is the expected time Vino will take to fill a redeem order. That said, Anemoy recently announced $125M in instant redemptions on LTF which will be coming online in the new year, greatly speeding up redemption times.