Protocol Economics

What this page is for: the on-chain economic parameters that govern every rFlow deal — the protocol fee, the buyback penalty curve, duration bounds, and the admin levers. For the $rFLOW token, supply, and distribution, see the dedicated tokenomics page.

Overview#

Every economic parameter rFlow uses is stored in the singleton ProtocolConfig account, seeds ["protocol_config"]. The defaults below come from programs/payflow/src/constants.rs and are tunable by the authority via update_config, capped at the program-level maxima.

Protocol fee#

A single 2% fee on selling_price is charged at fill time. The buyer pays the full sticker price; the program routes the seller the net amount and the treasury the fee:

1pub const DEFAULT_FEE_BPS: u16 = 200;   // 2.00 %
2pub const MAX_FEE_BPS:    u16 = 1000;  // 10.00 % (hard cap)

1// buy_deal flow
2const fee     = sellingPrice * feeBps / 10_000;
3const toSeller = sellingPrice - fee;
4
5token::transfer(buyer -> seller,   toSeller);
6token::transfer(buyer -> treasury, fee);

Buyback penalty curve#

A seller can exit an active deal early via buyback_deal. They pay back the buyer the selling price + accrued yield + a decaying penalty. The penalty starts at base_penalty_bps at purchased_at and decays linearly to min_penalty_bps at ends_at.

1pub const DEFAULT_BASE_PENALTY_BPS: u16 = 300;   // 3.00 %
2pub const DEFAULT_MIN_PENALTY_BPS:  u16 = 100;   // 1.00 %
3
4pub const MAX_BASE_PENALTY_BPS:     u16 = 3000;  // 30 % hard cap
5pub const MAX_MIN_PENALTY_BPS:      u16 = 1500;  // 15 % hard cap

1let progress_bps =
2    (time_elapsed * BPS_DENOMINATOR / total_duration) as u16;
3
4let penalty_range     = base_penalty_bps - min_penalty_bps;
5let penalty_reduction = penalty_range * progress_bps / BPS_DENOMINATOR;
6let current_penalty   = base_penalty_bps - penalty_reduction;
7
8let penalty_amount = selling_price * current_penalty / BPS_DENOMINATOR;
9let total_buyback  = selling_price + actual_yield + penalty_amount;

Duration bounds#

1pub const MIN_DURATION_DAYS: u16 = 30;
2pub const MAX_DURATION_DAYS: u16 = 365;

The SDK only accepts the discrete set 30 | 60 | 90 | 180 | 365 via the VALID_DURATIONS constant. The on-chain program accepts any value in the configured range; the SDK's tighter constraint is a UX convention.

Admin controls#

All economic parameters are mutable by the authority on ProtocolConfig via update_config. Every parameter is an Option<T> — pass only what changes:

1update_config({
2    fee_bps:          Some(200),
3    base_penalty_bps: Some(300),
4    min_penalty_bps:  Some(100),
5    is_paused:        Some(false),
6    use_oracle:       Some(true),
7    new_treasury:     None,
8    new_authority:    None,
9    add_mint:         Some(msolMint),
10    remove_mint:      None,
11    add_payment_mint: None,
12    remove_payment_mint: None,
13})

The authority is the only signer that can pause the protocol via is_paused. Active deals continue to settle while paused; only new deals are blocked.

$rFLOW token#

$rFLOW launches via Collaterize using Meteora DBC with bonding-curve mechanics, then migrates to DAMM V2. The token is independent of the deal protocol — there are no $rFLOW holdings required to buy or sell deals. Holders receive a share of protocol fees via staking.