🌎Emergency Global Settlement
The last-resort shutdown that returns user funds
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The last-resort shutdown that returns user funds
Emergency Global Settlement is the protocol's last-resort safeguard for catastrophic events — a critical exploit, an unrecoverable bug, or a systemic oracle failure. When executed by the protocol admin, all markets halt permanently and the protocol enters a redemption-only state.
Halt — all markets and the Token Vault stop. Price feeds are snapshotted for reference.
Redemption — each user's total assets and positions are valued (in present value, using the snapshotted prices) and replaced with a proportional basket of the collateral tokens held in the Token Vault. This applies to everyone, including users with deposits but no positions.
Withdrawal — users withdraw their replaced tokens. There is no deadline on redemption.
Token Vault holds $100,000 USDC and $200,000 of ETH (1:2 ratio). A user's total funds are $15,000 (a $10,000 lending position + $5,000 of deposits). After settlement, the user's claims are replaced with $5,000 in USDC and $10,000 in ETH, which they can withdraw at any time.
Irreversible — once triggered, markets never reopen; resuming operations would require new contract deployments. This one-way design lets users withdraw with certainty that the state won't change again.
Proportional — everyone receives the same collateral-token ratios; no queue-jumping.
Loss scenarios — if the vault itself lost funds (e.g. via the exploit that triggered settlement), redemptions are proportionally reduced. Settlement guarantees fair distribution of what remains, not immunity from the loss itself.
Contracts & Security — audits and bug bounty
Circuit Breaker and Base Price Adjustment — the everyday safety layers that make this one a last resort
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