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TACO and loss rebates

What is TACO?

TACO is the House LP's share token.

TACOName: Taco. Symbol: TACO.
ERC-4626An ERC-20 (BEP-20) following ERC-4626, with ERC-7540 asynchronous redemption.
One classTACO from deposits and TACO from loss rebates are identical, with the same rights and the same redemption rules.
TransferableTACO in a pending redemption is locked and cannot be transferred.
No supply capThe number of shares follows deposits, rebates and redemptions; what matters is net asset value.
0 premineNo premine, team allocation or airdrop. The protocol operator receives no TACO.

How much TACO does a loss earn?

When a position closes at a loss or is liquidated, the amount credited to the pool, L, earns TACO worth r × L at net asset value, minted in the same transaction directly to your wallet. The remaining (1 − r) × L stays with existing holders. Because open losses are already counted in net assets, holders see the loss as it builds up; at the close, the rebate is paid out of it.

Where a credited loss goes · example$980 credited to the pool after a $1,000 loss, at an 8% rebate rate.
r × L · $78.40 in TACOMinted to the losing trader at net asset value, in the same transaction.
(1 − r) × L · $901.60Stays in the House LP with existing TACO holders.

Deposits, openings, unrealized losses and winning or break-even closes earn nothing. If minting fails, the close or liquidation reverts.

Earns a rebate
Losing closeLiquidation
Earns nothing
DepositOpeningUnrealized lossWinning closeBreak-even close
CaseAmount credited to the pool (L)
Loss close, position funded from your balanceLoss minus the loss fee actually collected (2% when the queue is empty; no fee when it isn't)
Loss close, position funded from queued profitCanceled queued amount minus the loss fee actually collected
Liquidation, position funded from your balanceMargin minus the 2% liquidation fee (full margin when the queue isn't empty)
Liquidation, position funded from queued profitQueued amount used as margin

All losing positions closed with one signature are added into one L. Winning positions in the same batch do not offset it; the rebate is priced after the whole batch is settled.

How is the rebate rate set?

The rebate rate r is always below 1, so the pool keeps most of every loss.

30%While winners are queued or net assets are zero or negative.
15% → 8%Otherwise, r falls as the pool grows, from 15% for a near-empty pool to 8% once net assets reach $5 million, and stays at 8% above that.
1.5× → 1×Launch boost: for the first $2 million of cumulative credited losses, r is multiplied by a factor that starts at 1.5× and falls linearly to 1×.
3%–30%Limits: r never goes below 3% or above 30%.
Pool stateRebate rateTACO for a $1,000 loss
Net assets $10 million, after launch8%$78.40 ($980 credited after the loss fee)
Net assets about $100,000, early launchabout 22%about $217 ($980 credited)
Winners queued30%$300 ($1,000 credited; no loss fee while queued)
TACO rebate rate r · by net assets and cumulative credited losses
At launch · cumulative credited losses C = 0, 1.5× boostAfter launch · C ≥ $2M, no boost
0%5%10%15%20%25%30%$0$1M$2M$3M$4M$5M$6M$7M$8MQueued winners or A ≤ 0: fixed at 30% (cap)Flat above $5M22.5%15%12%8%Net assets A, including unrealized PnL.r = clamp(boost(C) × g(A), 3%, 30%) · g(A) = 8% + 7% × max(0, 1 − A ÷ $5M) · boost(C) = 1 + 0.5 × max(0, 1 − C ÷ $2M)

A higher rate returns more of a loss. It does not guarantee a gain: rebate TACO is worth r × L only at the net asset value when minted.

How can I acquire TACO?

Deposit USDT at net asset value, earn rebates from losing trades, or receive TACO from another holder.

Deposit
USDT at net asset valueAny time, with no cap. See Deposits and redemptions.
Loss rebate
From losing tradesLosing closes and liquidations earn TACO worth r × L.
Transfer
From another holderTACO is transferable, except while it is in a pending redemption.
Protocol · 07 / 12

TACO and loss rebates

What is TACO?

TACO is the House LP's share token.

TACOName: Taco. Symbol: TACO.
ERC-4626An ERC-20 (BEP-20) following ERC-4626, with ERC-7540 asynchronous redemption.
One classTACO from deposits and TACO from loss rebates are identical, with the same rights and the same redemption rules.
TransferableTACO in a pending redemption is locked and cannot be transferred.
No supply capThe number of shares follows deposits, rebates and redemptions; what matters is net asset value.
0 premineNo premine, team allocation or airdrop. The protocol operator receives no TACO.

How much TACO does a loss earn?

When a position closes at a loss or is liquidated, the amount credited to the pool, L, earns TACO worth r × L at net asset value, minted in the same transaction directly to your wallet. The remaining (1 − r) × L stays with existing holders. Because open losses are already counted in net assets, holders see the loss as it builds up; at the close, the rebate is paid out of it.

Where a credited loss goes · example$980 credited to the pool after a $1,000 loss, at an 8% rebate rate.
r × L · $78.40 in TACOMinted to the losing trader at net asset value, in the same transaction.
(1 − r) × L · $901.60Stays in the House LP with existing TACO holders.

Deposits, openings, unrealized losses and winning or break-even closes earn nothing. If minting fails, the close or liquidation reverts.

Earns a rebate
Losing closeLiquidation
Earns nothing
DepositOpeningUnrealized lossWinning closeBreak-even close
CaseAmount credited to the pool (L)
Loss close, position funded from your balanceLoss minus the loss fee actually collected (2% when the queue is empty; no fee when it isn't)
Loss close, position funded from queued profitCanceled queued amount minus the loss fee actually collected
Liquidation, position funded from your balanceMargin minus the 2% liquidation fee (full margin when the queue isn't empty)
Liquidation, position funded from queued profitQueued amount used as margin

All losing positions closed with one signature are added into one L. Winning positions in the same batch do not offset it; the rebate is priced after the whole batch is settled.

How is the rebate rate set?

The rebate rate r is always below 1, so the pool keeps most of every loss.

30%While winners are queued or net assets are zero or negative.
15% → 8%Otherwise, r falls as the pool grows, from 15% for a near-empty pool to 8% once net assets reach $5 million, and stays at 8% above that.
1.5× → 1×Launch boost: for the first $2 million of cumulative credited losses, r is multiplied by a factor that starts at 1.5× and falls linearly to 1×.
3%–30%Limits: r never goes below 3% or above 30%.
Net assets $10 million, after launch
Rebate rate
8%
TACO for a $1,000 loss
$78.40 ($980 credited after the loss fee)
Net assets about $100,000, early launch
Rebate rate
about 22%
TACO for a $1,000 loss
about $217 ($980 credited)
Winners queued
Rebate rate
30%
TACO for a $1,000 loss
$300 ($1,000 credited; no loss fee while queued)
TACO rebate rate r · by net assets and cumulative credited losses
At launch · cumulative credited losses C = 0, 1.5× boostAfter launch · C ≥ $2M, no boost
0%5%10%15%20%25%30%$0$2M$5M$8MWinners queued or A ≤ 0: fixed at 30%Flat above $5M22.5%15%12%8%Net assets A, including unrealized PnL.r = clamp(boost(C) × g(A), 3%, 30%) · g(A) = 8% + 7% × max(0, 1 − A ÷ $5M) · boost(C) = 1 + 0.5 × max(0, 1 − C ÷ $2M)

A higher rate returns more of a loss. It does not guarantee a gain: rebate TACO is worth r × L only at the net asset value when minted.

How can I acquire TACO?

Deposit USDT at net asset value, earn rebates from losing trades, or receive TACO from another holder.

Deposit
USDT at net asset valueAny time, with no cap. See Deposits and redemptions.
Loss rebate
From losing tradesLosing closes and liquidations earn TACO worth r × L.
Transfer
From another holderTACO is transferable, except while it is in a pending redemption.