How Taco works
One pool, two outcomes. Every position faces the House LP; a win is settled from it, a loss grows it and mints TACO for the trader.
Settle trades onchain
Every position settles against the protocol's USDT liquidity pool, called the House LP. The trading contract records the position and settles its profit or loss against this pool. The position is not routed to an external trading venue.
If your position closes in profit, the contract settles that profit from available LP liquidity after settlement deductions. If it closes at a loss, the loss adds to protocol liquidity and can mint TACO for you. Profit that cannot be settled immediately enters a settlement queue.
Mint TACO from losses
The protocol mints TACO from realized trading losses. The number of tokens you receive depends on the minting base, the current mint rate and how long you held the position.
While book LP (the pool's accounting balance) is below $2 million, the rate is 100 TACO per $1 of minting base, before the holding-time adjustment. Beyond that threshold, the rate declines with cumulative minting progress.
Stake TACO for USDT
Staked TACO shares USDT collected by the protocol. Flexible staking has 1× weight. Locked staking gives the same tokens more weight, up to 4× for a 52-week lock.
USDT is distributed hourly and can be claimed at any time. Claimed USDT goes to your trading balance. Newly minted TACO enters flexible staking by default.