Glossary
This page defines the concepts used across the Flying Tulip documentation.
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A
Aave (Aave v3) — A decentralized lending protocol used for conservative yield and collateralization in several Flying Tulip flows.
Accepted Assets — Tokens that can be contributed in the Public Capital Allocation (PCA) or used in products (e.g., USDC, USDT, USDS, USDe, USDtb, WETH, WBTC, cbBTC, SOL/jupSOL, AVAX/wAVAX).
Access Control (contracts) — Role‑based permissions on protocol contracts (e.g., Owner, Configurator, Multisig, Strategy Manager, Treasury).
Adapter Parameters (LayerZero) — Additional parameters (like gas settings) passed when sending OFT tokens cross‑chain.
AFTER_PUB_OFFERING — PutManager state after the PCA has ended; positions can Withdraw (invalidate PUT) or Divest (return collateral at par).
AMM (Automated Market Maker) — On‑chain market using formulas instead of a central order book to quote prices and execute swaps.
AEAD (Authenticated Encryption with Associated Data) — The cryptographic mode used by the TLS record layer to provide confidentiality and integrity. In Witnessnet proofs, successful AEAD decryption/authentication under the derived traffic keys demonstrates that the response data is authentic for that session.
AVAX / wAVAX — Avalanche’s native token and its wrapped ERC‑20 representation used for staking and liquidity.
B
Backing (Capital Backing) — The contributed assets that back each primary FT position while the Perpetual PUT Option remains open.
Backing Yield (Carry) — Yield generated by deploying backing into low‑risk venues. Priority: fund ecosystem development first (salaries/marketing/infra/ops); surplus funds buyback & burn of FT.
Basis / Funding (contextual) — The long/short spread or periodic payments that keep derivative prices aligned with spot (used in delta‑neutral strategies and futures).
Beets (staking venue) — A venue referenced for staking Sonic (S → stS) in certain strategies.
Buyback & Burn — Mechanism that buys FT on the open market and sends it to an irrecoverable address, permanently reducing supply. May be funded by backing yield surplus, protocol revenue/fees, or released backing from Withdrawals.
Binary Prediction Markets — Yes/No markets that resolve based on verifiable facts. In Flying Tulip, resolution is permissionless via Witnessnet proofs of HTTPS pages from accepted sources (e.g., news sites). Any third party can submit proof to settle the market.
Black–Scholes — A widely used options pricing model for valuing calls and puts based on inputs such as underlying price, volatility, time to expiry, and interest rates. In Flying Tulip, on‑chain Black–Scholes uses implied volatility from AMM windows to quote premiums for covered calls and puts.
C
Capital Efficiency — Using the same collateral to support multiple activities (e.g., earn yield and back trading/borrowing) to increase effective return per unit of capital.
CLOB (Central Limit Order Book) — An exchange mechanism that matches bids and asks; integrated with Flying Tulip’s permissioned lending for cross‑collateralized trading while deposits continue to earn.
Collateral / Collateral Caps — Assets allowed as collateral and the maximum per‑asset size configured to manage concentration and risk.
Configurator (role) — Admin role used to set or update parameters (e.g., pausing, asset lists, strategy weights).
Constant Product / Constant Sum — AMM curve archetypes: x·y = k (constant product) offers LP protection with higher price impact; x + y = k (constant sum) offers tight spreads with less protection. Flying Tulip blends them dynamically (see Hybrid Curve).
CertificateVerify (TLS) — A handshake step where the server proves possession of the private key corresponding to its certificate by signing the transcript. Witnessnet includes checks that the certificate is valid for the hostname and that CertificateVerify was verified.
Cross‑Collateral / Cross‑Margin — Using one deposit as collateral across multiple markets or products simultaneously (e.g., lending, CLOB, futures).
D
Debt Netting Mechanism — Pool‑level offsetting of long/short exposures that enables delta‑neutral configurations (e.g., ftUSD) with zero‑liquidation risk under defined parameters.
Delta‑Neutral — A portfolio whose net directional exposure is approximately zero, constructed by balancing long and short legs.
Divest (exercise) — Action that exercises the Perpetual PUT Option at par; the original asset/amount is returned.
Domain Separator / EIP‑712 — The typed‑data signing domain used for off‑chain signatures (e.g., permits).
Dynamic LTV — Borrowing limits that adapt to liquidity, volatility, and order size, instead of using fixed tables.
E
Ecosystem Budget (priority) — The first call on backing yield to fund the organization: salaries, marketing, infrastructure, and operations.
EMA (Exponential Moving Average) — A smoothing method used to detect calm vs. volatile market regimes.
EIP‑2612 Permit (gasless approval) — ERC‑20 extension enabling approvals via off‑chain signatures rather than on‑chain approval transactions.
Exit (legacy) — Legacy terminology for Divest (par return).
F
FT (Token) — The native token of Flying Tulip. Minted proportionally during the PCA (10 FT per $1) up to a hard cap of 10B. Supports cross‑chain transfers (OFT) and EIP‑2612 permits.
FT NFT — The ERC‑721 token that represents a holder’s Perpetual PUT Option. Each FT NFT (pFT) tracks the collateral, strike asset, and FT amount tied to a primary allocation position.
ftUSD — A delta‑neutral, yield‑bearing stable asset designed to target $1 while minimizing liquidation risk by balancing long/short exposures (e.g., supply/stake/borrow loops).
Funding Rate (Futures) — Periodic payments between long/short positions that keep future prices aligned with spot; can be computed from actual borrowing costs.
G
Gasless Approvals — Approving ERC‑20 allowances via off‑chain signatures (no on‑chain approval tx), typically through EIP‑2612.
H
Hybrid Curve (AMM) — A dynamic blend between constant sum (tight spreads in calm markets) and constant product (LP protection in volatility), informed by regime signals (e.g., EMAs) and guardrails.
I
IN_PUB_OFFERING — PutManager state while the PCA is active; investors can contribute and withdraw FT into their PUT position.
Impermanent Loss — The divergence loss LPs can face when an AMM pool’s asset prices shift relative to deposit prices; mitigated by Flying Tulip’s hybrid curve behavior in volatile regimes.
Invest (PutManager) — Deposit accepted assets to open a PUT position and withdraw FT issued into that PUT.
Insurance Pool / FT_exploit_insurance — A capital pool that backs exploit coverage; buyers pay usage‑based premiums, and providers earn yield from those premiums. Claims depend on event verification.
Isolated vs. Cross Margin — Isolated margin confines risk to a single market; cross margin shares collateral across multiple markets.
J
jupSOL — A liquid‑staking representation of SOL used for staking yield in conservative allocations.
K
Keepers (Liquidation Keepers) — External actors incentivized to execute liquidations or complex unwinds. Flying Tulip uses size/time‑sliced execution and rebates to reduce market impact.
L
LayerZero / OFT (Omnichain Fungible Token) — Cross‑chain messaging and token standard that allows FT to move natively across chains.
Lend - Permissionless — A lending system where each Spot pair automatically gets a lending market. Parameters adapt dynamically to market conditions.
Lend - Permissioned — A pre‑configured lending pool enabling cross‑collateral and powering CLOB and Futures; includes debt netting for zero‑liquidation strategies.
Leverage (Futures) — Trading with exposure greater than posted collateral; in FT futures, leverage constraints are set using depth ‑aware metrics.
Leveraged Liquidity (AMM) — LP mode that behaves like full‑range coverage but concentrates more capital near the current price to improve fee capture without constant re‑ranges.
Liquid Staking Token (LST) — A token representing staked assets (e.g., stETH, jupSOL) that accrues staking rewards while remaining liquid.
Liquidation / Soft Liquidation — Forced unwind of risky positions; Flying Tulip emphasizes gradual "soft" liquidations via Spot routing, with size/time‑slicing and keeper incentives.
Loan‑to‑Value (LTV) — Borrowing limit as a ratio of collateral value; may be a snapshot at opening to avoid abrupt changes affecting users.
Launchpad — The token‑launch workflow. Teams create a token with thresholded deposits; when thresholds are met, the Spot + money market deploy automatically. Anti‑MEV protections may apply initially. Leverage/futures unlock after an RWAP warm‑up period.
M
Merkle Claims / Merkle Rewards — Distributions computed off‑chain and claimed on‑chain via Merkle proofs; supported by wrapper utilities.
Multisig — A multi‑signature wallet with elevated permissions used for safety‑critical admin actions.
N
No Bridging (backing) — Backing capital remains on the source chain and is not bridged as part of the default allocation policy.
Non‑Custodial — Users retain control of assets; contracts enforce rules without centralized custody.
O
OFT (LayerZero) — See LayerZero / OFT.
Oracle (price oracle) — External feed of asset prices. Flying Tulip futures derive pricing/settlement from in‑house trading activity to avoid oracle lag/manipulation.
Order Book (CLOB) — See CLOB; orders can rest while deposits continue to earn in the permissioned lending system.
Opt‑In Settlement LP (Futures) — Liquidity providers who supply ftUSD to settlement pools and earn per‑settlement fees, with exposure managed across providers.
P
pFT (PUT position token) — The developer‑facing token representing a specific Perpetual PUT Option position (one position per token). Used by contracts to manage withdrawFT (invalidate PUT) and divest (exercise at par).
Pause / Pausing — Temporarily halting token transfers or protocol operations via admin roles for safety.
Perpetual Futures (Futures) — Futures without expiration; Flying Tulip uses on‑chain trading as the primary price source with sub‑second settlement and funding tied to real borrowing costs.
Perpetual PUT Option — The on-chain right attached to primary-issued FT that lets a holder:
(1) Hold (keep the FT NFT attached),
(2) Divest (return collateral at par), or
(3) Withdraw (unlock FT; invalidate the PUT; released backing can fund market buyback and burns of FT).
Price Impact — Slippage caused by trade size relative to available depth; managed by hybrid curves and depth‑aware metrics.
Public Capital Allocation (PCA) — The on‑chain public event where contributors exchange accepted assets for FT at a fixed rate (10 FT per $1). FT is minted proportionally up to a maximum supply of 10B.
Passkeys (WebAuthn / FIDO2) — Passwordless authentication bound to a device or security key. Used with delegated session keys to enable one‑click, wallet‑less UX while maintaining on‑chain security guarantees.
PutManager — The contract that orchestrates PCA participation, FT issuance into PUT positions, and post‑offering actions such as invest, withdrawFT, divest, and state transitions.
Q
Queues / Unbonding (staking exits) — Waiting periods required to withdraw from certain staking positions (e.g., stETH withdrawals, SOL/AVAX unbonding).
R
Reserve‑Weighted Average Price (RWAP) — A price metric that weights observations by available reserves near the path of execution, providing a depth‑aware benchmark for swaps.
Revenue & Fees (Protocol) — Cashflows generated by Flying Tulip products (e.g., ftUSD/settlement rails, Spot, Lend, Futures, Insurance) routed to buyback & burn and used to govern unlocks.
Revenue‑Funded Unlocks (40:20:20:20) — When buybacks are funded by revenue, Foundation/Team/Ecosystem/Incentives unlock 1:1 in a 40:20:20:20 split. Yield‑only buybacks do not unlock.
Risk Controls (Spot & Lend) — Guardrails and procedures (e.g., regime detection, snapshot LTV, soft liquidation, size/time‑slicing, incentivized keepers) that aim to reduce tail risk and market impact.
S
sUSDe / USDe — A yield‑bearing form (sUSDe) and its base asset (USDe) used in certain strategies and as accepted assets in the PCA.
Settlement Currency / Pools (Futures) — ftUSD is used as the settlement currency; opt‑in LPs deposit ftUSD to settlement pools and earn fees.
Settlement Speed (sub‑second) — Future settlements are designed to execute quickly (sub‑second) using on‑chain trading as the price source.
Snapshot LTV — Borrow limits fixed at the time of opening/adjustment to protect users from abrupt parameter changes.
Soft Liquidation — Gradual unwind via Spot with size/time‑slicing and incentives to reduce slippage.
Sonic (S) / wS / stS — Sonic chain’s token and its wrapped/staked variants referenced in certain strategies and accepted‑assets lists.
Session Keys (Delegated Keys) — Short‑lived keys authorized by a user’s wallet to approve a bounded set of actions (e.g., trading). Enable smooth UX (no constant pop‑ups) while preserving withdrawal controls.
State Channels — Off‑chain execution channels that update balances with periodic on‑chain commitments. Used to enable continuous trading; channels cannot withdraw funds, which requires native signing.
stETH — A liquid‑staking representation of ETH used for conservative staking yield.
Stablecoin — A token pegged to a reference value (e.g., USD). ftUSD is a stable, delta‑neutral, yield‑bearing variant.
Strategy (ftYieldWrapper) — A yield venue tracked by the wrapper; strategies can be added/removed/reordered and capital moved between them by authorized roles.
Strike Price (PUT) — The par conversion rate in a PUT: the asset and amount a holder receives when exercising (divesting) FT.
Surplus (Yield Surplus) — Backing yield remaining after the ecosystem budget; the surplus is used for buyback & burn.
T
Technical Appendix — The quantitative reference for the PCA: allocation assumptions, backtested carry, formulas, sensitivity tables, and combined scenarios (yield + revenue + withdrawals).
Time‑Sliced Execution — Breaking a large unwind into smaller pieces over time to reduce price impact.
Token Unlocks — See Revenue‑Funded Unlocks (40:20:20:20); unlocks are releases from pre‑allocated buckets, not new token inflation.
Total Supply / Circulating Supply — FT has a hard cap of 10B; PCA mints proportional to capital raised. Burns and redemptions reduce the circulating or total supply based on the mechanism.
TWAP (Time‑Weighted Average Price) — A time‑only averaging of price used in oracles and analytics; complements depth‑aware measures.
TWAR (Time‑Weighted Average Reserve) — A depth‑aware measure used in futures that considers how much of X can be sold for Y over time, enabling safer leverage and funding calculations.
U
UMA Oracle (Optimistic Oracle) — Third‑party verification service used by Insurance to confirm exploit events before claims are paid.
Unlocks 40:20:20:20 — See Revenue‑Funded Unlocks.
USDC / USDT / USDS / USDe / USDtb — Stablecoins accepted in PCA contributions and used across products; each has distinct risk/peg mechanics.
V
Vault (PutManager) — A wrapper/vault address paired with an accepted collateral token that routes deposits to the correct yield wrapper.
W
WBTC / cbBTC — Bitcoin representations used on EVM chains; accepted assets for PCA and supported in some products.
Withdraw (invalidate PUT) — Unlock FT from the Perpetual PUT Option; the PUT is invalidated and the released backing funds market buyback and burn of FT. What the holder does next with FT is independent of this action.
Wrapper Token (e.g., ftUSDC) — ERC‑20 share tokens issued by the yield wrapper for a specific underlying, representing a claim on aggregated strategy positions.
Witnessnet — A framework that lets smart contracts verify facts about HTTPS responses without a trusted oracle. Contracts receive (url, response data, proof) where the proof shows: AEAD‑authenticated TLS records under correctly derived traffic keys; Finished messages verified; and a valid server certificate matching the hostname with proven key possession (CertificateVerify). Any party can submit proofs, making "any HTTPS endpoint an implicit oracle."
Y
Yield Wrapper (ftYieldWrapper) — A contract layer that aggregates and manages multiple yield strategies for one underlying, standardizing deposits/withdrawals/claims and enforcing role‑gated operations.
Yield Surplus (Y) — The remaining annual backing carry after the ecosystem budget (E) has been funded: Y = max(B − E, 0). Converted to retired FT by Y / P, where P is the average buyback price.