How it works

Wind

The user deposits the base asset and selects target leverage. The system borrows against interim collateral, a pending-settlement base asset (PSBA) minted for the request, on the lending market and submits the deposit request to the tokenised asset source in the same action. While the asset settles off-chain (T+1 or longer, depending on the asset), the interim collateral backs the borrow in the request’s escrow; once the asset is delivered, it replaces the interim collateral and the user, or a Keyring operator on their behalf, finalises the request. The result is an ordinary collateralised position in the user’s own lending market account.

While the tokenised asset settles, interim collateral (PSBA) in the request's escrow backs the borrow; on delivery, the user (or a Keyring operator on their behalf) finalises the position into their account.

Synchronous markets

Some markets wind synchronously: the position opens in a single transaction, with no interim collateral and no separate finalisation step. Each market’s page states how it winds.

Holdbacks

Some issuers subscribe instantly at a price above the latest published NAV (a wedge) and withhold a portion of the collateral, delivering it after the asset’s next valuation. Where the delivery lands depends on how the market executes: in a wind that runs through a Keyring user wallet it arrives there and is included in the position when the wind is finalised, while in a synchronous wind it can arrive in the user’s own wallet after the position has opened. Each market’s page states its exact treatment. The wedge and the delivered amount are issuer terms: the amount depends on how the NAV moves, and it is not a guaranteed return.

Permissioned assets and whitelisting

A permissioned asset is a tokenised asset whose transfers the issuer restricts: every transfer requires both parties to be whitelisted by the issuer. Whitelisting is a know-your-customer step run by the issuer, not by Keyring, and it is separate from the Keyring credential the market’s policy requires. A wallet without a whitelist entry cannot receive or move the token, and transfers revert. Which addresses need entries depends on how the market executes; each market’s page states which address the issuer must whitelist for its users, and for markets that run through a Keyring user wallet it is that wallet. Winding such a market has two prerequisites: the issuer’s whitelisting and a valid Keyring credential.

Unwind

The user locks the position; the market’s provider settles the redemption. A provider is the entity whose mint and redemption process the market’s adapter contract drives, and whose proceeds arrive in the base asset; each market’s page names its own. The request mints a Receipt NFT (ERC-721) that tracks the locked position until fulfilment; each request runs in its own escrow, isolated from every other request.

Settlement runs through the tokenised asset’s own redemption process. Its timing follows the asset’s redemption cycle. A Keyring operator records a request’s proceeds, all at once, only after the whole request is claimable; there is no partial settlement.

The issuer-redemption path: the market's adapter drives the asset's own redemption process. The Keyring fee rate is recorded when the request is created and deducted at finalisation.

Once proceeds land, the escrow repays the debt, fees are deducted from the redeemed proceeds, and the remainder goes to the Receipt NFT holder in the base asset.

Each market has one issuer-redemption path: its adapter drives the asset's own redemption process. A secondary sale exits by selling to a buyer instead.

Secondary sales

A secondary sale exchanges collateral with a buyer instead of waiting for issuer redemption. The buyer funds debt repayment and seller proceeds in one transaction. Prices come from standing offers or a request for quote; each accepted trade settles separately. See Secondary sales (RFQ) for the journey, access requirements and risks.

The issuer-redemption request lifecycle

An unwind escrow moves through a small state machine:

Initialized. Escrow deployed for the request.
Pending. Debt pulled from the user’s account into the escrow.
Redeeming. Collateral sent to the provider’s adapter for redemption; interim collateral maintains the lending market position.
Finalized. Debt repaid, proceeds distributed, escrow closed.

If the position turns unhealthy before settlement completes, an auction liquidation can reduce its debt and its interim collateral. The escrow stays in the Redeeming state. Redemption and normal finalisation still complete, and the auction winner can then claim its payout. See liquidations.

Liquidation does not interrupt the lifecycle: it reduces the escrow's debt while the request stays Redeeming, the request still closes through the same terminal state, and the winner's payout is carved out of the proceeds at finalisation before the Receipt NFT holder is paid.

Fees

Fees on winding and on issuer redemption are paid in the base asset. The Keyring infrastructure fee is set in basis points in each market’s on-chain manager configuration. Wind deducts it from the subscription notional when the request is created; unwind deducts it from gross redemption proceeds during finalisation, at the rate recorded on the request. Any separate issuer costs are market terms rather than a fee field in the manager contracts.

Secondary sales instead deduct the market’s [un]wind fee from the seller’s proceeds during settlement; see secondary sale costs.

Roles

Operation is split across roles: an admin configures markets, a Keyring operator settles individual requests and can finalise them on users’ behalf, a Keyring-held role opens liquidation auction rounds for unhealthy escrows, and a safety manager can pause normal activity. Liquidation rounds are deliberately never blocked by a pause; a winner’s payout on a request that is not yet finalised waits for the unpause, because finalisation is paused; see risk.